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 document comprises a prospectus (the "Prospectus") relating to Nippon Active Value Fund plc (the "Company") and the Prospectus has been approved by the Financial Conduct Authority ("FCA") as competent authority under Regulation (EU) 2017/1129 (the "Prospectus Regulation"). The FCA only approves this Prospectus as meeting the standards of completeness, comprehensibility and consistency imposed by the Prospectus Regulation and such approval should not be considered as an endorsement of the Company that is the subject of this Prospectus and of the quality of the Shares that are the subject of this Prospectus. Investors should make their own assessment as to the suitability of investing in the Shares.

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 11 to 21 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 200 million Ordinary Shares at an Issue Price of 100 pence per Ordinary Share1

and

Placing Programme of up to 400 million Ordinary Shares and/or C Shares (inclusive of any Ordinary 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 4 and 36 of this Prospectus, and the Directors, whose names appear on pages 5 and 36 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 Ordinary Shares issued pursuant to the Initial Placing, Offer for Subscription and Intermediaries Offer will commence, at 8:00 a.m. on or around 5 February 2020. The International Security Identification Number ("ISIN") for the Ordinary Shares to be admitted to trading is: GB00BKLGLS10. The ISIN for the C Shares to be admitted to trading is: GB00BKLGLT27.

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 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.

¹ The Directors have reserved the right, in consultation with Shore Capital, to increase the size of the Issue up to 400 million Ordinary Shares if overall demand exceeds 200 million Ordinary Shares. Any such increase will be announced through an RNS announcement.

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 and 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 their respective clients or for providing any advice in relation to First Admission, the Initial Placing, the Offer for Subscription, each Programme Admission and 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 the 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 Ordinary Shares and C Shares (together, the "Shares"), the First Admission, the Initial Placing, the Offer for Subscription, the Intermediaries Offer, each Programme Admission and 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 8 January 2020 and closes at 5:00 p.m. on 28 January 2020, 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 Ordinary 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, including the United Kingdom, 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, including the United Kingdom, where the Shares are lawfully marketed), Canada, Australia, the Republic of South Africa or Japan or their respective territories or possessions.

The Ordinary 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 Ordinary 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 Ordinary Shares in the United States. The Ordinary 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, including the United Kingdom, 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.

7 January 2020

	PROSPECTUS REGULATION SUMMARY	4
PART 1:	RISK FACTORS	11
PART 2:	IMPORTANT INFORMATION	22
PART 3:	VOLUNTARY COMPLIANCE WITH THE LISTING RULES	32
PART 4:	EXPECTED TIMETABLE, STATISTICS AND DEALING CODES	34
PART 5:	DIRECTORS, INVESTMENT ADVISER AND ADVISERS	36
PART 6:	INFORMATION ON THE COMPANY	38
PART 7:	DIRECTORS, MANAGEMENT AND ADMINISTRATION	46
PART 8:	INVESTMENT APPROACH, STRATEGY AND PROCESS	58
PART 9:	THE ISSUE	66
	PART 10: PLACING PROGRAMME	73
	PART 11: UNITED KINGDOM AND JAPANESE TAXATION	79
	PART 12: GENERAL INFORMATION	84
	PART 13: DEFINITIONS AND INTERPRETATION	111
	PART 14: TERMS AND CONDITIONS OF APPLICATION UNDER THE PLACING AND THE PLACING PROGRAMME	118
	PART 15: TERMS AND CONDITIONS OF APPLICATION UNDER THE OFFER FOR SUBSCRIPTION	129
ANNEX:	AIFM DIRECTIVE DISCLOSURES	148

PROSPECTUS REGULATION SUMMARY

INTRODUCTION AND WARNINGS

Name of the issuer:	Nippon Active Value Fund plc
Legal entity identifier of the issuer:	213800JOFEGZJYS21P75
Contact details:	Mermaid House, 2 Puddle Dock, London EC4V 3DB
Name and ISIN of securities:	The ISIN of the Ordinary Shares is GB00BKLGLS10
	The ISIN of the C Shares is GB00BKLGLT27
Offeror:	The Shares are being offered by the Company
Competent authority approving this prospectus:	FCA Head Office, 12 Endeavour Square, London E20 1JN United Kingdom
Date of approval of this prospectus:	7 January 2020

The summary should be read as an introduction to the Prospectus. Any decision to invest in the 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. Where a claim relating to the information contained in the Prospectus is brought before a court, the plaintiff investor might, under national law, have to bear the costs of translating the Prospectus before the legal proceedings are initiated. 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 January 2020 and closes at 12 noon on 28 January 2020, unless closed prior to that date. Prospective investors interested in participating in the Intermediaries Offer should apply for Ordinary Shares through the Intermediaries by following their relevant application procedures by no later than 12 noon on 28 January 2020.

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 Act and regulations thereunder. The Company does not have a fixed winding-up date.

The Company's principal activity will be 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 in those companies.

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

l 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
l 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. 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 the date of this Prospectus there are no persons known to the Company who, directly or indirectly, will be interested in three per cent. or more of the Company's issued share capital or voting rights on First Admission.

On First Admission, 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:

l 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. The AIFM is entitled, with effect from First Admission 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.
l 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 in respect of the assets of the Company with effect from First Admission. Rising Sun is entitled, with effect from First Admission to an annual fee calculated as 0.85 per cent. of the Company's net assets (exclusive of VAT).
l PraxisIFM Fund Services (UK) Limited which has been appointed by the Company as administrator and company secretary to provide day-to-day administration services to the Company and provide general company secretarial functions to the Company, including those secretarial functions required by the Companies Act 2006 in relation to the Company. It will also provide certain administrative services to

the Company which includes reporting Net Asset Value, bookkeeping and accounts preparation. The Administrator is entitled, with effect from First Admission to 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.

l Its statutory auditors, who are expected to be formally appointed shortly following First Admission.

What is the key financial information regarding the issuer?

As the Company has been recently incorporated and has not commenced operations, no financial statements have been made up and no annual reports have been published. This Prospectus does not contain pro forma financial information. The Company will commence operations subject to and following First Admission.

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:

l The Company is a newly formed company with no operating results. It will not commence operations until it has obtained funding through the Issue. As the Company lacks an operating history, investors have no 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. 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.
l 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 with Rising Sun. The Company cannot predict the impact that any such departure will have on the Company's ability to achieve its investment objective or pursue its investment policy. The departure of a significant number of individuals from Rising Sun for any reason, or the failure to appoint qualified or effective replacements in the event of such departures, could have a material adverse effect on the Company's ability to achieve its investment objective.
l Rising Sun is a newly formed company with no operating results, financial statements or investment track record. The company is therefore reliant upon the track record of the Rising Sun Management Team. This track record, which was acquired as part of activities performed by individuals at prior organisations, may not be comparable to or indicative of such persons' performance for the Company.
l 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. The level of returns to Shareholders are reliant primarily upon the performance of the Portfolio. If the Portfolio does not perform as well as expected, Shareholders may not be able to receive dividends or realise the amount of their original investment in the Shares.
l 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 likely size of the stakes that the Company will possess in its portfolio companies will, at least initially, mean that it will not be able to utilise certain shareholder actions in all instances.
l 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. 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 government policy, legal or regulatory changes or 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.

KEY INFORMATION ON THE SECURITIES

What are the main features of the securities?

Description of securities

The securities which the Company intends to issue (or sub-divide and redesignate) are Ordinary Shares of the Company of £0.01 each, whose ISIN is GB00BKLGLS10 and C Shares of £0.01 each, whose ISIN is GB00BKLGLT27.

The Ordinary Shares and C Shares 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
Redeemable Preference Shares	50,000	50,000
Ordinary Shares	0.01	1

The Redeemable Preference Shares are paid up as to one quarter of their nominal value. Immediately prior to First Admission, the Redeemable Preference Shares will be sub-divided and re-designated into Ordinary Shares and paid up by the holders of such shares to 100 pence per Ordinary Share. The Ordinary Share currently in issue is 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 UK 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 Ordinary 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:

l 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.
l 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 Ordinary Shares which are being issued (or sub-divided and re-designated from Redeemable Preference Shares) at 100p per Ordinary Share. The total number of Ordinary Shares allotted under the Issue will be determined by the Company, Shore Capital and Rising Sun after taking into account demand for the Ordinary Shares and prevailing economic and market conditions, subject to a maximum of 200 million Shares2.

The Initial Placing, Offer for Subscription and the Intermediaries Offer are conditional amongst other things on: (i) 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; (ii) proceeds of not less than £100 million being raised through the Issue; and (iii) First Admission becoming effective not later than 8:00 a.m. on 5 February 2020 or such later time and/or date as Shore Capital and the Company may agree (being not later than 8:00 a.m. on 28 February 2020).

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 Shares issued (or sub-divided and redesignated) pursuant to the Issue are expected to be issued on 5 February 2020. 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.

² The Directors have reserved the right, in consultation with Shore Capital, to increase the size of the Issue up to 400 million Ordinary Shares if overall demand exceeds 200 million Ordinary Shares. Any such increase will be announced through an RNS announcement.

An investor applying for Ordinary Shares under the Issue may elect to receive Ordinary 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 Ordinary Shares issued in certificated form are expected to be despatched during the week commencing 10 February 2020.

Placing

The Company, each of the Directors, Rising Sun, Rosenwald Capital 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 Ordinary Shares to be made available in the Initial Placing. The Initial Placing is not being underwritten.

The Intermediaries Offer

Investors may also subscribe for Ordinary 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. 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 Ordinary 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 Ordinary 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 Ordinary Shares (representing a subscription price of £1.00 per Ordinary Share).

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 400 million Shares in aggregate less the number of Ordinary Shares issued under the Issue plus the Company's existing subscriber share) 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 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 6 January 2021. The issue of New Ordinary Shares or C Shares under the Placing Programme is at the discretion of the Directors. Each investor is required to undertake to make payment for the New Ordinary Shares and/or C Shares issued to such investor pursuant to the Placing Programme in such manner as shall be directed by Shore Capital.

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. Where applicable, definitive certificates in respect of the New Ordinary Shares and/or C Shares are expected to be despatched by post to the relevant holders no later than 10 Business Days after the relevant issue date.

Dilution

No dilution will result from the Issue.

Assuming that 200 million New Ordinary Shares are issued under the Placing Programme, raising £200 million at a Placing Programme Price of 100p per New Ordinary Share and assuming that £200 million are raised pursuant to the Issue, a Shareholder holding shares representing five per cent. of the Company's issued ordinary share capital following the Issue, who does not participate in the Placing Programme, would, following the completion of the Placing Programme, hold shares representing approximately 2.5 per cent. of the Company's issued ordinary share capital.

Expenses

The costs of the Issue will not be charged to Shareholders as the Issue Expenses will be borne by Rosenwald Capital. Therefore, following the Issue the Company will have a Net Asset Value per Ordinary Share of 100 pence, which is equal to the Issue Price. The Issue Expenses are those that are necessary for the establishment of the Company and completion of the Issue (which include commission and expenses payable under the Placing Agreement entered into in connection with the Issue, registration, listing and admission fees, printing and distribution costs and professional advisory fees, including legal fees, and any other applicable expenses associated with 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 Placing Programme Price of any New Ordinary Shares issued pursuant to a Subsequent Placing 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 one per cent. of the amounts raised. The Directors therefore intend to avoid any dilution of the Net Asset Value of the existing Ordinary Shares held by Shareholders. By way of illustration, assuming an initial NAV of 100p per Ordinary Share, the Placing Programme Price per New Ordinary Share would be expected to be at least 101p, and the expenses indirectly borne by an investor in such New Ordinary Shares would be approximately 1p 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.

The Shares are being offered by the Company.

Why is this prospectus being produced?

Up to 200 million Ordinary Shares are available under the Issue at the Issue Price to raise Gross Proceeds of up to £200 million. Assuming that the Issue is fully subscribed, and the Issue Expenses are nil as a consequence of them being paid by Rosenwald Capital, the proceeds from the Issue will be £200 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. 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:

l 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;
l 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;
l 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
l Shore Capital owns 15 per cent. of Rising Sun's issued share capital and it is anticipated that one of Shore Capital's group companies will subscribe for 1,000,000 New Ordinary Shares in the Initial Placing.

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 newly formed company with no operating history and no revenues, and investors have no basis on which to evaluate the Company

The Company is a newly formed company with no operating results, financial statements or current investments. It will not commence operations until it has obtained funding through the Issue. As the Company lacks an operating history, investors have no basis 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 Admission. 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) 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 and will also, through one of its group companies, subscribe for 1,000,000 New Ordinary Shares in the Initial Placing.

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 no overlapping investments with Dalton Investments LLC and the focus of Rising Sun will be to invest in enterprises in which neither Dalton nor its clients have any interest.

Risks relating to the UK's exit from the European Union

A referendum was held on 23 June 2016 to decide whether the UK should remain in the EU and the vote was in favour of leaving (''Brexit''). On 29 March 2017, the UK triggered the formal process to leave the EU. The extent of the impact of Brexit on the Company will depend in part on the nature of the future arrangements that are put in place between the UK and the EU following the eventual Brexit and the extent to which the UK continues to apply laws that are based on EU legislation. The Company may be subject to a significant period of uncertainty during the negotiation of the UK's ongoing trading relationship with the EU including, among other things, uncertainty in relation to any potential regulatory or tax change. Brexit could also create significant UK (and potentially global) stock market uncertainty or foreign currency fluctuations, which may have a material adverse effect on the Company and/or the price of the Shares. As such, it is not possible to accurately state the impact that Brexit will have on the Company and its proposed investments at this stage. Brexit may also increase the regulatory compliance burden on the Company. This could restrict the Company's future activities and thereby negatively affect returns.

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 newly formed company with no operating results, financial statements or investment track record. The Company is therefore reliant on the track record of the Rising Sun Management Team. This track record, which was acquired as part of activities performed by individuals at prior organisations, may not be comparable to or 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 First Admission). 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 Company. 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 managing partners 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 the 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

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 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.

Risk associated with investing in a single country

The Company will 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 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:

l 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.
l 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.
l 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.
l 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.
l 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.
l 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.
l The value of Japanese securities may be affected by factors not typically associated with investments in the UK. Liquidity and settlement risk of 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.
l 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"), expected to take effect from May 2020, will oblige 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 will give 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 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 European, national and local governments. 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.

European regulation includes Directive 2014/65/EU of the European Parliament and of the council of 15 May 2014 on markets in financial instruments and amending Directive 2002/92/EC and Directive 2011/61/EU (''MiFID'') and Regulation (EU) No 600/2014 of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments and amending Regulation (EU) No 648/2012 (''MiFIR'') (MiFID and MiFIR, together ''MiFID II'') which came into force on 3 January 2019. The Company has been advised that its Shares should be treated as ''non-complex'' investment (as defined in MiFID II) but this cannot be guaranteed.

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 post-tax returns to Shareholders. Statements in this Prospectus including 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.

(c) Accounting

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

Assuming the minimum proceeds of the Issue of £100 million are raised, the Rosenwald Associates will own in the region of 29 per cent. of the total issued share capital of the Company. The precise shareholdings of the Rosenwald Associates will depend on the outcome of the Issue as a whole.

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 Associates' 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 Associates, and may have the effect of delaying or preventing decision making on significant matters relating to the Company. To the extent that the Rosenwald Associates' 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.

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 will be 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 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 develop 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

The Directors have been authorised to issue up to 400 million Shares, less any Ordinary Shares that are issued pursuant to the Issue, immediately following First Admission without the application of pre-emption rights. If the Directors decide to issue further Shares on a non-pre-emptive basis the proportions of the voting rights held by holders of Ordinary Shares on First Admission will be diluted on the issue of such shares as each Share carries the right to one vote.

The voting rights may be diluted further on the conversion of any C Shares.

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 invests; (ii) the price at which such Shareholder can effect such realisation; and/or (iii) the price at which 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). Shore Capital does not intend 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 26 to 28 of this Prospectus.

The contents of the Company's website, and the contents of any websites which can be accessed through links on the Company's 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, the Ordinary 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 8 January 2020 and closes at 5:00 p.m. on 28 January 2020, 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 Ordinary Shares through the Intermediaries by following their relevant application procedures by no later than 12 noon on 28 January 2020. The Company and the Directors accept responsibility for the information contained in this Prospectus with respect to any purchaser of Ordinary 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:

l the legal requirements within their own countries for the purchase, holding, conversion, transfer or other disposal of Shares;
l any foreign exchange restrictions applicable to the purchase, holding, conversion, transfer or other disposal of Shares which they might encounter; and
l 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 no 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 12 (General Information) of this Prospectus.

The actual number of Ordinary Shares and/or C Shares to be issued pursuant to the Issue 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.

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 any UK, or EU regulatory requirements (including FSMA, AIFM Directive, the Prospectus Regulation, the Prospectus Regulation Rules, the Takeover Code, the 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 12 (General Information) of this Prospectus.

5. Presentation of financial information

The Company is newly formed and as at the date of this Prospectus has not commenced operations and has no assets or liabilities, and therefore no statutory financial statements have been prepared as at the date of this Prospectus. All future financial information for the Company is intended to be prepared in accordance with IFRS. In making an investment decision, prospective investors must rely on their own examination of the Company from time to time and the terms of the Issue or Placing Programme (as applicable).

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 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:

l "GBP", "pounds sterling", "£", "pence" or "p" are to the lawful currency of the UK;
l "US\$" or "US Dollars" are to the lawful currency of the United States; and
l "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, including the United Kingdom, 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 contained within: (a) EU Directive 2014/65/EU on markets in financial instruments, as amended ("Directive 2014/65/EU"); (b) Articles 9 and 10 of Commission Delegated Directive (EU) 2017/593 supplementing Directive 2014/65/EU; and (c) local implementing measures (together, the ''MiFID II Product Governance Requirements''), and disclaiming all and any liability, whether arising in tort, contract or otherwise, which any ''manufacturer'' (for the purposes of the MiFID II Product Governance Requirements) may otherwise have with respect thereto, the Ordinary Shares have been subject to a product approval process, which has determined that any Shares to be issued pursuant to the Issue and the Placing Programme are: (i) compatible with an end target market of investors who are professionally advised investors or certified as high net worth investors or certified (including self-certified) as sophisticated investors in accordance with COBS 4.7.9 in the FCA Handbook or certified as restricted investors in accordance with COBS 4.7.10 and investors who meet the criteria of professional clients and eligible counterparties, each as defined in Directive 2014/65/EU; and (ii) eligible for distribution through all distribution channels as are permitted by Directive 2014/65/EU (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 the requirements of any contractual, legal or regulatory selling restrictions in relation to the Issue and the Placing Programme including, without limitation, those set out in this document. 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 Directive 2014/65/EU; 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 (including the Intermediaries) is responsible for undertaking its own target market assessment in respect of the Shares and determining appropriate distribution channel.

10. PRIIPs Regulation

In accordance with the PRIIPs Regulation, a key information document in respect of an investment in the Company has been prepared and is available to investors at the Company's website. The content of the key information document is highly prescriptive, both in terms of the calculations underlying the numbers and the narrative, with limited ability to add further context or explanation. As such, the key information document should be read in conjunction with other material produced by the Company, including this Prospectus and, in future, the annual reports which will be available on the Company's website.

11. Taxation

A summary of certain limited aspects of UK and Japan taxation applicable to the Company and Shareholders is contained in Part 11 (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, including the United Kingdom, 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, including the United Kingdom, 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, including the United Kingdom, 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, including the United Kingdom, 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, including the United Kingdom, 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.

If you are resident in the United Arab Emirates, Israel, Guernsey, Switzerland or Belgium, your attention is directed to the information set out below.

United Arab Emirates

This Prospectus relates to marketing information concerning Foreign Securities which are being distributed on the basis of paragraphs 3(3), (5) and/or (6) of Article 2 of Decision No (3/R.M) of 2017 Regulating the Promotion and Introduction by the Chairman of the Board of Directors of the Emirates Securities & Commodities Authority. This material is intended for distribution only to persons of the type specified in that Article. It must not be delivered to, or relied on by, any other person. By receiving this Prospectus, potential investors understand, acknowledge, agree and confirm that they are a person of the type specified in that paragraph.

Neither this Prospectus, nor the offer of any Foreign Security contained in it has been reviewed, verified, approved or otherwise authorized in any way by the Emirates Securities & Commodities Authority ("SCA"), UAE Central Bank or any other governmental authority in the United Arab Emirates, nor has the Shore Capital received any form of approval, registration, licensing or any other form of authorization from the SCA, the UAE Central Bank or any other governmental authority in the United Arab Emirates to promote or sell any of the Foreign Securities or financial services within the United Arab Emirates.

No marketing or other form of promotion of any Foreign Security or financial services has been or will be made from or within the United Arab Emirates, other than in compliance with the laws of the United Arab Emirates. No subscription to any Foreign Securities may or will be completed within the United Arab Emirates. It should not be assumed that Shore Capital is a licensed broker, dealer, promoter or investment advisor under the laws applicable in the United Arab Emirates, or that it advises individual residents in the United Arab Emirates as to the appropriateness of investing in or purchasing or selling any financial products mentioned herein. The Foreign Securities will not be offered or sold directly or indirectly to the public in the United Arab Emirates. This Prospectus does not constitute a public offer of securities in the United Arab Emirates in accordance with Federal Law No 2 of 2015 on commercial companies or otherwise.

Nothing contained in this Prospectus is intended to constitute investment, legal, tax, accounting or other professional advice. This Prospectus is for your information only and nothing contained in it is intended to endorse or recommend a particular course of action. Persons considering acquiring any Foreign Security should consult with an appropriate professional for specific advice rendered based on their personal situation. Prospective purchasers of Foreign Securities to which this Prospectus relates should conduct their own due diligence on them. If you do not understand the contents of this Prospectus, you should consult an authorized financial advisor.

Israel

The offer (or actual sale) of Shares in Israel is an offer only to an investor to whom a copy of this document has been furnished by the Company and/or its authorised agents and this on the basis that said investor falls within the definition of a "Qualified Investor" (namely, an investor enumerated under the First Schedule to the Israeli Securities Law, 5728-1968) and that before the date of every acquisition of Shares by an investor, such investor has given his written consent that all the conditions enumerated under said Schedule apply to him and that he is aware of the meaning of the fact that he is an investor included in said Schedule and consents thereto, as mandated under Israeli applicable law. The Company is not authorised to, and does not intend to, offer the Securities offered under this Prospectus to the general public in Israel.

Guernsey

This document has not been filed with, or approved by, the Guernsey Financial Services Commission (''GFSC'') and no authorisations in respect of the Protection of Investors (Bailiwick of Guernsey) Law, 1987, as amended (the ''POI Law'') have been issued by the GFSC in respect of it. Neither the GFSC nor the States of Guernsey Policy Council takes any responsibility for the financial soundness of the Company or for the correctness of any of the statements made or opinions expressed with regard to it. This document does not comply with the requirements of Guernsey's Prospectus Rules 2008 2018 on the basis that the Shares in the Company will be admitted to trading on the Specialist Fund Segment for listed securities of the London Stock Exchange plc: if the Shares are not so admitted, then the document may be required to comply with the requirements of such Prospectus Rules 2008 2018 and may need to be re-drafted in some respects. This document is directed in the Bailiwick of Guernsey only at the following: (i) those who have specifically solicited this document, where such approach was not itself specifically solicited by Shore Capital (''Requesting Investors"); or (ii) those holding a licence from the GFSC under any of the following laws: the POI Law, the Banking Supervision (Bailiwick of Guernsey) Law, 1994, as amended, the Insurance Business (Bailiwick of Guernsey) Law, 2002, as amended, the Insurance Managers and Insurance Intermediaries (Bailiwick of Guernsey) Law, 2002, as amended or the Regulation of Fiduciaries, Administration Businesses and Company Directors etc. (Bailiwick of Guernsey) Law, 2000, as amended (such persons being ''GFSC Licensees''). This document must only be distributed to persons who are not either Requesting Investors or GFSC Licensees by a person holding an appropriate licence from the GFSC under the POI Law. This document may not be relied upon by those who are not Requesting Investors or GFSC Licensees, unless it has been distributed to them by a person holding such a licence under the POI Law.

Switzerland

This Prospectus may only be freely circulated and Shares in the Company may only be freely offered, distributed or sold to regulated financial intermediaries such as banks, securities dealers, fund management companies, asset managers of collective investment schemes and central banks as well as to regulated insurance companies. Circulating this Prospectus and offering, distributing or selling Shares in the Company to other persons or entities including qualified investors as defined in the Federal Act on Collective Investment Schemes (''CISA'') and its implementing Ordinance (''CISO'') may trigger, in particular, (i) licensing/prudential supervision requirements for the distributor, (ii) a requirement to appoint a representative and paying agent in Switzerland and (iii) the necessity of a written distribution agreement between the representative in Switzerland and the distributor. Accordingly, legal advice should be sought before providing this Prospectus to and offering, distributing, selling or on-selling Shares of the Company to any other persons or entities. This Prospectus does not constitute an issuance prospectus pursuant to Articles 652a or 1156 of the Swiss Code of Obligations and may not comply with the information standards required thereunder. The Shares will not be listed on the SIX Swiss Exchange, and consequently, the information presented in this document does not necessarily comply with the information standards set out in the relevant listing rules. The documentation of the Company has not been and will not be approved, and may not be able to be approved, by the Swiss Financial Market Supervisory Authority (''FINMA'') under the CISA. Therefore, investors do not benefit from protection under the CISA or supervision by the FINMA. This Prospectus does not constitute investment advice. It may only be used by those persons to whom it has been handed out in connection with the Shares and may neither be copied or directly/indirectly distributed or made available to other persons.

Belgium

The Ordinary Shares and the C Shares may be offered in Belgium: (a) only to investors acquiring Instruments for a total consideration of at least 250.000 EUR per investor, acting in its own name and for its own account, or (b) solely to qualified investors, in reliance on Article 1.4(a) and 1.4(d) of the Prospectus Regulation and in reliance of Article 10, §3, 1° of the Law of 11 July 2018 on the offer of investment instruments to the public and the admission of investment instruments to the trading on a regulated market ("Prospectus Law") and Article 5, §1 of the Law of 19 April 2014 on the alternative investment funds and their managers, and as such terms have been defined in the Prospectus Regulation and the Prospectus Law. When received by a Belgian resident, this document is addressed to that person only. Any subscription by a Belgian resident can only be accepted on the condition that such person shall ensure that any resale will satisfy the same conditions as set forth in Article 1.4(a) and 1.4(d) of the Prospectus Regulation.

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. FATCA and other tax information reporting 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 ORDINARY SHARES BY THE COMPANY; AND (C) A PROSPECTIVE INVESTOR IN ORDINARY 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 Shares will continue to be considered to be "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 signalled their intention to enter into similar information exchange agreements. The Organisation for Economic Co-operation and Development 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. In December 2014, the EU formally adopted Council Directive 2014/107/EU to assist member states in combating tax evasion and fraud by extending the scope for the automatic exchange of information ("DAC"). Broadly speaking, DAC implements the CRS within the EU. For FATCA and the CRS, the 2019 reporting period will end on 31 December 2019, with reporting to HMRC by financial institutions for that period to take place by 31 May 2020. Failure to comply with the rules imposed by FATCA and other information exchange regimes could cause the Company be subjected to financial penalties.

As a result of FATCA (and the other FATCA-style agreements noted above), 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 and other FATCA-style agreements, the Company cannot guarantee that it will be able to satisfy its obligations under FATCA (and other information exchange regimes). Prospective investors and Shareholders are encouraged to consult their own tax advisors regarding the possible implications of FATCA and other information exchange regimes to their investment in 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 Ordinary Shares in the Company. In relation to the Initial Placing, the Ordinary 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 Prospectus Regulation. No arrangement has however been made with the competent authority in any other 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

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 UK Listing Authority will not apply to the Company.

The Company will be 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 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 voluntarily comply with the following key provisions of the Listing Rules should First Admission be granted:

(a) The Company is not required to comply with the Listing Principles set out at Chapter 7 of the Listing Rules. Nonetheless, it is the intention of the Company to comply with these Listing Principles from First Admission.
(b) The Company is not required to appoint a listing sponsor under Chapter 8 of the Listing Rules. It has appointed Shore Capital as sole bookrunner and 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 comply with all of the provisions of Chapter 9 of the Listing Rules from First Admission.
(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 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) related party transactions 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 (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 comply with the following provisions of Chapter 13 of the Listing Rules from First Admission: (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 comply with the following provisions of Chapter 15 of the Listing Rules from First Admission: 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

1. Expected Timetable of Principal Events

Prospectus published	7 January 2020
Initial Placing, Offer for Subscription and Intermediaries Offer opens	8 January 2020
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 28 January 2020
Latest time and date for receipt of Initial Placing orders	12:00 noon on 28 January 2020
Latest time and date for receipt of applications from Intermediaries in respect of the Intermediaries Offer	12:00 noon on 28 January 2020
Results of the Initial Placing, Offer for Subscription and Intermediaries Offer announced	31 January 2020
First Admission of the Ordinary Shares to the Specialist Fund Segment and dealings commence	8:00 a.m. on 5 February 2020
CREST accounts credited in respect of Ordinary Shares issued in uncertificated form	as soon as practicable after 8:00 a.m. on 5 February 2020
Certificates despatched in respect of Ordinary Shares issued in certificated form	week commencing 10 February 2020
Placing Programme opens	6 February 2020
Placing Programme closes	6 January 2021

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.

2. Illustrative Issue Statistics

Issue price per Ordinary Share	100p
Target number of Ordinary Shares to be issued by the Company pursuant to the Issue3	200,000,000
Target number of Ordinary Shares in issue following the Issue	200,000,001
Target proceeds from the Issue	£200,000,000
Estimated Net Asset Value per Ordinary Share on First Admission	100p

3. Illustrative Placing Programme Statistics

Maximum number of Ordinary and/or C Shares	400 million (inclusive of any Ordinary 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 one per cent. of the gross proceeds of the relevant Subsequent Placing under the Placing Programme

Placing Programme Price per C Share 100 pence

4. Dealing Codes

Ordinary Shares

Ticker NAVF

ISIN GB00BKLGLS10 SEDOL BKLGLS1

C Shares

Ticker NAVC

Legal Entity Identifier of the Company 213800JOFEGZJYS21P75

ISIN GB00BKLGLT27 SEDOL BKLGLT2

³ The Directors have reserved the right, in consultation with Shore Capital, to increase the size of the Issue up to 400 million Ordinary Shares if overall demand exceeds 200 million Ordinary Shares. Any such increase will be announced through an RNS announcement.

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

Mermaid House 2 Puddle Dock London EC4V 3DB

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.intfundmanagament.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

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

Sole bookrunner

Shore Capital Stockbrokers 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 Mermaid House 2 Puddle Dock London EC4V 3DB Website: www.praxisifm.com

Legal Advisers to the Company

Mills & Reeve LLP 24 King William Street London EC4R 9AT

Legal Advisers to Shore Capital

Travers Smith LLP 10 Snow Hill London EC1A 2AL

Reporting accountants

PricewaterhouseCoopers LLP 1 Embankment Place London WC2N 6RH

Registrars and Receiving Agent

Computershare Investor Services PLC The Pavilions Bridgwater Road Bristol BS13 8AE

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

1. Introduction

The Company is a newly incorporated 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 intends to commence operations following First Admission and carry on business as an investment trust within the meaning of Chapter 4 of Part 24 of the Corporation Tax Act 2010, as amended. 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 of the London Stock Exchange.

The Company intends to invest in shares issued by listed or traded companies which have the majority of their operations in, or revenue derived from, Japan.

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.

2. Investment opportunity

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

l Investment objective: the Company will aim 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).
l Investment strategy: the Board, as a consequence of recent regulatory and governance changes in Japan, consider it to be the right time to launch 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.
l 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.
l Identified investments: Rising Sun has already identified a number of 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.
l 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 and compliance and capital markets experience.
l Issue and Placing Programme: the Company is targeting an issue of up to 200 million Ordinary Shares pursuant to the Issue, comprising of the First Placing, the Offer for Subscription and the Intermediaries Offer at the Issue Price (being £1.00 per 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.
l Leverage: the Company may, once the proceeds 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.

l Nil initial cost: the costs of the Issue will not be charged to Shareholders as the Issue Expenses will be borne by Rosenwald Capital. Therefore, following the Issue the Company will have a Net Asset Value per Ordinary Share of 100 pence, which is equal to the Issue Price.

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 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 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 will apply the following restrictions on the size of its investments:

l 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
l 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 will be no restrictions placed on the market capitalisation of investee companies, but it is expected that the portfolio will be weighted towards small cap companies with market capitalisations of up to US\$1 billion. Once fully invested, 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.

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 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):

l 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;
l 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
l 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.

The Company intends to only invest in enterprises which are distinct from those of Dalton's existing clients. Should the Company ever find that it is targeting the same opportunity as Dalton (or one if its affiliates) or is invested in the same enterprise as Dalton (or one of its affiliates), the Company will take appropriate advice and action at the time.

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 does not have a borrowing facility but may, in the future, use borrowings 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 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.

4. Investment strategy

The Company will seek 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 and 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.

5. Cornerstone investors

The Company has received (i) a binding commitment in the amount of £25 million and (ii) a non-binding indication of interest in the amount of £25 million which Dalton has agreed to use its best endeavours to convert into participations in the Issue following the publication of the Prospectus, for a total of £50 million which has been made by Dalton or by its managing member, in each case in their capacity as the investment manager for and on behalf of certain pooled investment funds and institutional client separate accounts (together the "Dalton Clients" and each a "Dalton Client"). The binding commitment of £25 million includes a £5 million participation by Kings Bay Investment Company Ltd to be made upon the Share Conversion becoming effective (as further described in paragraph 2 of Part 12 (General Information)).

The Company expects Dalton to manage the commitments of its clients so as to ensure that the total individual commitment of any particular Dalton Client does not exceed five per cent. of the total proceeds raised by the Issue.

In addition, Dalton shall not be required to secure participation by Dalton Clients, if and only to the extent that to do so would result in the Rosenwald Associates owning more than 29 per cent. of the total issued share capital of the Company. Consequently, it is expected that the Rosenwald Associates will adjust their participation in the Issue so as to ensure that the aggregate shareholding of the Rosenwald Associates will be less than 30 per cent. of the voting rights in the Company so as to avoid any implications as a result of the requirement under Rule 9 of the Takeover Code to, in certain circumstances, make an offer for the entire issued share capital of the Company.

The Company has also secured a commitment of £1 million from a group company of Shore Capital.

6. 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 AIFM Directive that apply in respect of the marketing of the shares of the Company in the EU and the UK, and undertaking risk management.

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

7. 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, will be 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.

8. 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 will target results primarily through capital appreciation, no specific dividend policy will be established in the first instance 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.

9. Capital structure

9.1 Share capital

The Company's share capital structure immediately following the Issue will consist of Ordinary Shares. The Ordinary Shares will be 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.

9.2 Further issues of Shares

Under the UK Companies 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 Directors currently have authority to issue further Shares on a non pre-emptive basis, provided that the number of Ordinary Shares (including New Ordinary Shares) and C Shares issued pursuant to the Issue and Placing Programme may not exceed 400 million Shares in aggregate. This authority will extend until the day prior to the first anniversary of the publication of this Prospectus. 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 10 (Placing Programme) of this Prospectus.

Following the expiration of the Placing Programme authority, the Directors will also have a general authority to issue Shares having, in aggregate, a nominal value of up to 20 per cent. of the aggregate value of the Company's issued share capital immediately following Admission, which will expire on the date of the Company's AGM to be held in 2021.

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.

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 400 million, less any Ordinary Shares issued under the Issue 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 20 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 Prospectus Regulation. Article 1(5) of the 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 form the date hereof, subject to the requirement under the Prospectus Regulation to the publication of supplementary prospectuses to disclose any significant changes in the financial or trading position of the Company.

10. Use of Proceeds

The Company's principal use of cash raised pursuant to the Issue and the Placing Programme will be to make investments in accordance with the terms of its investment policy including those investee companies which have already been identified at the date of this document and to meet the ongoing operational expenses of the Company.

Rosenwald Capital has agreed to pay all of the initial costs associated with the Issue and consequently the Company can commit a greater proportion of the proceeds of the Issue to its investment strategy rather than using such amount to pay costs and expenses associated with the Issue and establishment of the Company.

11. 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 authorised to make market purchases of up to 14.99 per cent. of the aggregate number of issued 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 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.

12. Duration

The Company has been established with unlimited life. However, the Directors intend to offer shareholders with an exit opportunity at close to NAV around the fifth anniversary of Admission (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.

13. 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 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:

l 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;
l the Company is not a close company at any time during the accounting period for which approval is sought;
l the Company is resident in the UK throughout that accounting period;
l the Company's ordinary share capital is admitted to trading on a regulated market (as defined in FSMA) throughout the accounting period; and
l 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.

14. AIFM Directive

The Company operates as an externally managed EEA domiciled AIF with a Non-EEA AIFM for the purposes of the AIFM Directive. Accordingly, the AIFM has notified the FCA in accordance with Article 42 of the AIFM Directive, of the intention to market the Company in the UK during the period from the date of publication of this Prospectus until the date on which the UK formally exits the European Union (or such later date as is permitted by any transitional arrangements). The AIFM is licensed and regulated by the Guernsey Financial Services Commission.

15. Non-mainstream pooled investment products

The Company is not deemed to be a non-mainstream pooled investment because, as an investment trust, the Ordinary 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 will be met in relation to the Shares and that accordingly, the Shares should be considered ''non-complex'' for the purposes of MiFID II.

16. 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.

17. 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 Share of the Company. Announcements of unaudited NAV per share, will be made on a daily basis through a Regulatory Information Service. The unaudited NAV per 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 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.

18. 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, commencing in 2021.

The first accounting period of the Company will end on 31 December 2020 and, thereafter, accounting periods will end on 31 December in each year. The audited annual accounts will be published via an RIS within four months of the year end to which they relate. Unaudited half yearly reports, made up to 30 June will be 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 will be prepared in accordance with IFRS, and the annual accounts will be 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.

19. Taxation

Potential investors are referred to Part 11 (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.

PART 7 DIRECTORS, MANAGEMENT AND ADMINISTRATION

1. 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 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 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 specializing 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.

2. 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 AIFM Directive that apply in respect of the marketing of the shares of the Company in the EU and the UK, 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 6.2 of Part 12 (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 with effect from First Admission, 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 shall have 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 newly incorporated Cayman entity which will be led by James B. Rosenwald, III. Mr Rosenwald has over 40 years' experience investing in Asia and is co-founder and managing partner of Dalton Investments LLC. 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 Tokyo and Mumbai, Dalton manages (as at 31 May 2019) 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\$1.2bn under management) is set out below.

The Dalton Japan Long Only composite track record as at 30 September 2019 (data presented in accordance with the Global Investment Performance Standards)

Sources: Dalton Investments LLC and Morningstar.

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, which will provide investment research services to the Investment Adviser.

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 Managing Partner and founding member of Dalton Investments LLC 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 Managing Director and Portfolio Manager for Dalton Investments LLC, 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 board of Cambridge University in America (New York) and the Capital Campaign for Cambridge University (Cambridge, UK), as well as on the investment committees of the College of the Atlantic (Bar Harbor) and the Mt. Desert Land and Garden Preserve (Seal Harbor).

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 Vice Chairman of Cambridge and Counties Bank, and was a founding member of Cambridge and Counties when it was established in 2012.

He has over 40 years' experience in the financial services industry as well as having considerable experience in international capital markets. This includes previous directorships of N M Rothschild & Sons Ltd, NatWest Markets and Rabobank International.

Since September 2004, Paul has been the Bursar of Trinity Hall, Cambridge one of Cambridge University's oldest colleges. Paul holds MA degrees from 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 from the years 2006-2018.

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 during 2013-2015. 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 6.1 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 shall provide 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 managing partners of Dalton Investments LLC.

4. 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, each of the Directors, Rising Sun, Rosenwald Capital 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 Ordinary Shares to be made available in each placing. No placing will be underwritten.

A summary of the Placing Agreement is set out in paragraph 6.4 of Part 12 (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 will maintain the register of Shareholders, process all share transfers in both paper form and electronic form received via CREST and calculate and effect 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 6.5 and 6.6 of Part 12 (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 shall ensure 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 shall also ensure 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 6.7 of Part 12 (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 will also provide 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 6.8 of Part 12 (General Information) of this Prospectus.

5. Fees and Expenses

5.1 Initial Fees and Expenses

The costs and expenses of the establishment of the Company, the Offer for Subscription, the Initial Placing and the Intermediaries Offer (which include commission and expenses payable under the Placing Agreement, registration, listing and admission fees, printing and distribution costs and professional advisory fees, including legal fees, and any other applicable expenses) will be met by Rosenwald Capital.

As such, the Company will not bear any upfront costs that would reduce the Issue Proceeds available for investment and accordingly, on First Admission, the opening NAV per Ordinary Share will be £1.00.

The Issue will not proceed if the aggregate number of Shares to be issued under the Placing and the Offer for Subscription is less than 100 million Ordinary Shares. On the basis of the minimum gross proceeds from the Issue being £100 million, and the estimated costs and expenses of the Issue which are borne by the Company being nil, the minimum net proceeds from the Issue are expected to be £100 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. No Ordinary Shares issued pursuant to a Subsequent Placing will be issued at a Placing 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.

5.3 Annual running expenses

The Company will incur 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 £5,000 plus £12.50 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 pro-rated fees payable to the Directors appointed as at the date of this document in respect of the Company's first financial year (approximately 14 months from the

date of the Company's incorporation) will be £35,000 per annum for Rosemary Morgan, who is chairperson of the Board and who will also chair the Company's Management Engagement Committee and Nomination Committee, £30,000 per annum for Chetan Ghosh, who will chair 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 and market capitalisation are £200 million, such fee would be approximately £6,800 in the Company's first financial year.
(h) Audit fees the Company expects that the cost of appointing its preferred auditor to perform an annual audit of the Company's financial statements will be approximately £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.

Assuming that the Issue is fully subscribed, the Company's total fixed operational costs (excluding management fees, brokerage and other transaction charges and taxes and any borrowing costs) are estimated to amount to approximately one per cent. per annum of the Company's estimated Net Asset Value on Admission.

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

6. 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 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;
(c) explain the risks that arise as a result of the conflicts of interest; and
(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.

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:

l 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;
l 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;
l 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

l Shore Capital owns 15 per cent. of Rising Sun's issued share capital and will also, through one of its group companies, subscribe for 1,000,000 New Ordinary Shares in the Placing.

7. Corporate governance

7.1 Compliance

The Board is committed to high standards of corporate governance and has made arrangements to enable the Company, as a newly incorporated company, to comply with the recommendations of the Corporate Governance Code published by the Financial Reporting Council. The Board intends to obtain membership of the AIC following Admission and as such, intends to comply 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 will meet at least four times a year and will receive full information about the Company's investment performance, assets, liabilities and other relevant information in advance of Board meetings. The Directors' biographical details, set out in paragraph 1 of this Part, demonstrate a breadth of investment, commercial and professional experience, including in activist investment experience and experience in the Japanese equities market. The Directors will 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 will regularly review 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 will also receive regular briefings from, amongst others, the Company's auditor (once appointed) 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 will meet 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 will review the need for non-audit services and authorise such on a case by case basis.

The Audit Committee will 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 will meet with the auditor (once appointed) without representatives of the Administrator or Rising Sun being present, at least once a year.

7.4 Management Engagement Committee

The Management Engagement Committee will meet 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 will meet at least once per year. It comprises each member of the Board and is chaired by Rosemary Morgan. 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):

l 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;
l reviewing the performance of the Company in light of the Company's strategy objectives and budgets, ensuring that any necessary corrective action is taken;
l 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;
l approving any interim dividends, any recommendation to shareholders in respect of final dividends and the Company's dividend policy;
l the review of the Company's corporate governance processes and arrangements; and
l approving any actual or potential conflicts of interest.

8. Takeover Code

The Takeover Code will apply to the Company from First Admission. Further details are provided at paragraph 4 of Part 12 (General Information).

9. 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.

10. MAR and the Disclosure Guidance and Transparency Rules

As a company whose shares will be admitted to trading on the SFS (a regulated market), the Company will comply with all of the provisions of MAR 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 Market Abuse Regulation. The Board will be 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

1. 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 is now opportune for an activist strategy that will engage 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 will seek 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 will focus 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.) 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 organizing acquisitions in the Japanese market.

Dalton Investments LLC 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, when combined with its belief that the Yen is currently undervalued, mean that it is the right time to launch a dedicated activist vehicle. Rising Sun believes that a closed-end structure is ideally suited for this opportunity given the small-cap nature of the Portfolio and the activist engagement with investee company management.

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

1. 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 two-thirds 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 1 June 2019, circa 80 trade for less than the value of their net working capital after deducting all liabilities, and circa 100 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).

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 profitably 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	17.2	1.7	9.1
MSCI World	18.9	2.4	11.8

Source: Bloomberg statistics for Nikkei 225 and MSCI World indexes as at 30 September 2019.

Source: Bloomberg, 29 January 2019

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, 2019

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.

3,532 listed companies (excluding financial companies)	March 2019
Cash Holdings	108.7 trillion Yen
Cash + Securities	184.6 trillion Yen
$Cash \geq Market Capitalisation$	222 companies (6.2%)
$Cash + Securities \ge Market Capitalisation$	499 companies $(13.9\%)$
Cash + Securities $-$ Liabilities with interest $\geq$ Market Capitalisation	199 companies (5.5%)

Source: Ryo Yanagi – Professor, Waseda University, 2019

3. Corporate governance reform

Historically, for reasons of history and culture, the Investment Adviser believes many Japanese companies have been run inefficiently and capital allocation has been poor. Reasons for this 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 graphics:

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.

However, 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) Stewardship Code, established in February 2014

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) The Corporate Governance Code established in June 2015

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.

(c) Introduction of New Stock-based Compensation ("Restricted Stock") as Board Members' Compensation to Encourage Companies to Promote Proactive Business Management Compensation in April 2016

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) 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) M&A guidelines reform in June 2019

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.

4. 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.

5. 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.

In early 2007 Dalton exited its shareholding in Sun Telephone, a wholesaler importer and exporter of telecommunications equipment, listed on the first sections of the Tokyo and Osaka stock exchanges, for a reported ¥3,000m profit. It is considered to be one of the earliest major interventions by a foreign activist hedge fund in Japan. Dalton, who had acquired a 30 per cent. interest, pressed Sun Telephone's board to implement changes for many years through private meetings initially, as they did not want to appear predatory. In June 2006 the Sun Telephone board sought to issue potentially dilutive warrants and in response Dalton obtained an interim injunction from the Tokyo District Court to prevent the issue. Dalton subsequently launched a tender offer for up to 90 per cent. of the company's outstanding shares with the aim of obtaining 40 per cent. to be able to block any extraordinary motions. The result was Dalton tendering nearly 9 per cent. of outstanding shares and obtaining a shareholding of 39.6 per cent. in November 2006. In November 2006, Dalton proposed that Sun Telephone be delisted by way of an MBO. The Sun Telephone board opposed it, but it subsequently arranged an MBO through Japan Industrial Partners and Bain Capital in December. Finally, Dalton sold its shareholding in early 2007 in the MBO, generating its significant return.

The most recent example of Dalton engaging in an activist strategy in Japan is with Prestige International Inc., a CRM solution service provider. In May 2016, a senior executive from Dalton Advisory KK joined the Board of Prestige International. This allowed Dalton to address the size of the distributions to shareholders, which have increased significantly, with ensuing increases in the Prestige International share price.

2. Investment strategy

The Company intends, as its principal activity, 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 ("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:

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

Rising Sun has identified a number of opportunities (initially 20 potential opportunities have been identified) which are currently trading at 3X-4.5X EV/EBITDA. The Investment Adviser believes that the identified companies have attractive fundamental characteristics and prospects. In addition, the investee companies will be ones which the Investment Adviser believes have significant scope to improve returns through changes in capital allocation such as increased dividends, share buybacks for cancellation and the sale of investment portfolios which are not part of the core business. A summary of the characteristics of these identified 20 initial companies are detailed below:

	Market Cap (Ybn)	P/E	EV/ EBITDA	Net Cash/ Mkt Cap	Insider ownership	Sectors	Sample activist angle
Lowest	10	5.7	$-2.8$	$-74%$	$0.1\%$	Consumer, Financial,	Too much cash, M&A arbitrage, negative EV, cross shareholdings,
Highest	88	21.9	5.9	122%	11.8%	Industrial. Basic	collective engagement
Average	38	11.4	2.4	48%	1.8%	Materials

Source: Rising Sun, September 2019 (note: this table has been prepared for illustrative and indicative purposes only and should not be relied on for representation of the investments the Company will eventually make.)

The Investment Adviser will take 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 will draw on both its in-house experience in investing in Japanese companies as well as rely 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 pursue multiple activist strategies, including:

l communication and dialogue with management teams and boards (including management meetings and letters and presentations to the board);
l putting representatives of the Company on the board of investee companies;
l 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;
l collective engagement with other shareholders;
l partnerships within the industry as well as turnaround specialists; and
l 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, 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 will seek 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 will be 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 Committee

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 committee (the "Management Committee") that is responsible for reviewing and evaluating potential investment opportunities. The Management Committee'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 Committee, 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, of 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.

PART 9 THE ISSUE

1. Introduction

The Issue consists of the Initial Placing, the Offer for Subscription, and the Intermediaries Offer pursuant to the Company is targeting the issue of up to 200 million Ordinary Shares in aggregate at the Issue Price of 100p per Ordinary Share.

The costs of the Issue will not be charged to Shareholders, as the Issue Expenses will be borne by Rosenwald Capital. Therefore, following the Issue the Company will have a Net Asset Value per Ordinary Share of 100 pence, which is equal to the Issue Price. The Issue Expenses are those that are necessary for the establishment of the Company and completion of the Issue (which include commission and expenses payable under the Placing Agreement entered into in connection with the Issue, registration, listing and admission fees, printing and distribution costs and professional advisory fees, including legal fees, and any other applicable expenses associated with the Issue).

The Issue constitutes the initial opportunity to purchase Ordinary Shares in the Company. The total number of Ordinary 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 Ordinary Shares and prevailing economic and market conditions, subject to a maximum of 400 million Shares.

The Company has received (i) a binding commitment in the amount of £25 million and (ii) a non-binding indication of interest in the amount of £25 million which Dalton has agreed to use its best endeavours to convert into participations in the Issue following the publication of the Prospectus, for a total of £50 million which has been made by Dalton or by its managing member, in each case in their capacity as the investment manager for and on behalf of Dalton Clients. The binding commitment of £25 million includes a £5 million participation by Kings Bay Investment Company Ltd to be made upon the Share Conversion becoming effective (as further described in paragraph 2 of Part 12 (General Information)).

The Company has also secured a commitment of £1 million from a group company of Shore Capital.

Assuming that a total of £200 million is raised pursuant to the Issue, the aggregate participation of the Rosenwald Associates is expected to be in the region of £50 million.

Assuming that £200 million is raised pursuant to the Issue, up to approximately 29 per cent. of the Ordinary Shares issued by the Company are expected to be held by members of the Rosenwald Associates on Admission.

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

l 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;
l proceeds of not less than £100 million being raised through the Issue; and
l First Admission becoming effective not later than 8:00 a.m. on 5 February 2020 or such later time and/or date as Shore Capital and the Company may agree, (being not later than 8:00 a.m. on 28 February 2020).

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 6.4 of Part 12 (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 Ordinary Shares issued pursuant to the Issue will not be permitted prior to Admission.

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 Placees to subscribe for Ordinary 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 6.4 of Part 12 (General Information) of this Prospectus.

The terms and conditions which apply to any subscription for Ordinary Shares pursuant to the Initial Placing are set out in Part 14 (Terms and Conditions of Application under the Initial Placing and the Placing Programme) of this Prospectus.

3. The Offer for Subscription

Ordinary Shares will also be offered for subscription in the United Kingdom only through the Offer for Subscription at 100p per Ordinary Share payable in full on application.

Applications under the Offer for Subscription must be for a minimum of 5,000 Ordinary Shares (representing a subscription price of £1.00 per Ordinary Share). Multiple subscriptions under the Offer for Subscription by individual investors will not be accepted.

The Ordinary 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 Ordinary 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 15 (Terms and Conditions of Application under the Offer for Subscription) of this Prospectus. The procedure for applying for Ordinary 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 Ordinary Shares will be issued pursuant to the Issue 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 28 January 2020. 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, or delivered by hand (during normal business hours) to Computershare, The Pavilions, Bridgwater Road BS13 8AE, so as to be received by no later than 1.00 p.m. on 28 January 2020 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 Ordinary Shares at the Issue Price pursuant to the Intermediaries Offer. Applicants under the Intermediaries Offer may subscribe for Ordinary 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 12 (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 Ordinary 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 Ordinary Shares in the Intermediaries Offer means that the applicant agrees to acquire the Ordinary 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 Ordinary Shares. Where an application is not accepted or there are insufficient Ordinary 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. The Company, the AIFM and Shore Capital accept no 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 Ordinary 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 Ordinary 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, Ordinary Shares will be offered 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 Ordinary 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 Ordinary Shares in the Issue and each subsequent investor in the Ordinary 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 14 (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 400 million Ordinary Shares to be issued pursuant to the Issue and 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 Ordinary Shares will commence on 5 February 2020.

Subject to the Issue becoming unconditional, the Ordinary Shares are expected to be issued on 5 February 2020, 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 Ordinary Shares delivered to a CREST stock account in their own name, which is expected to take place on 5 February 2020, 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 Ordinary Shares issued in certificated form, which is expected to take place in the week commencing 10 February 2020. Dealings in the Ordinary Shares issued pursuant to the Issue will not be permitted prior to Admission. Subsequent to Admission, dealings in Ordinary 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.

When admitted to trading, the Ordinary Shares will be 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 Ordinary Shares, nor does it guarantee the price at which a market will be made in the Ordinary Shares. Accordingly, the dealing price of the Ordinary Shares may not necessarily reflect changes in the 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 31 January 2020 and, in any event, prior to Admission.

8. Conditions of the Issue

The Issue is conditional on, among other things, (i) the Placing Agreement not being terminated in accordance with its terms at any time prior to Admission and (ii) Admission occurring by 8:00 a.m. on 5 February 2020 (or such later date as the Company and Shore Capital may agree, being in any event not later than 8:00 a.m. on 28 February 2020). If either 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 Ordinary 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 5 February 2020 (or such later date as the Company and Shore Capital may agree, being in any event not later than 8:00 a.m. on 28 February 2020) 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

The Directors are authorised to issue up to 400 million Ordinary Shares pursuant to the Issue. To the extent that aggregate demand exceeds 400 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 Ordinary Shares pursuant to the Issue. Accordingly, applicants for Ordinary Shares may, in certain circumstances, not be allotted the number of Ordinary 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 Ordinary Shares through the Initial Placing, Offer for Subscription or Intermediaries Offer exceed the aggregate value, at the Issue Price, of the Ordinary Shares issued pursuant to such application, the Company will notify investors of the number of Ordinary 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 200 million Ordinary Shares under the Issue at the Issue Price to raise proceeds of up to £200 million. All Ordinary Shares issued pursuant to the Issue will be paid up to the Issue Price.

Since Rosenwald Capital has agreed to pay the costs of the Issue, if the Company achieves its target then the proceeds from the Issue will be £200 million.

11. Use of proceeds

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

The Company intends to use the net cash proceeds of the Issue and Placing Programme for investment in accordance with its investment policy and to fund the Company's operational expenses.

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, Shore Capital or the Intermediaries Adviser may require evidence of the identity of each investor in connection with any application for Ordinary Shares, including further identification of the applicant(s) before any Ordinary Shares are issued.

Each of the Company and its agents, including the AIFM, the Administrator, the Registrar, the Receiving Agent, Rising Sun, Shore Capital and the Intermediaries Adviser 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 Ordinary 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, Shore Capital and the Intermediaries Adviser may refuse to accept a subscription for Ordinary 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, Ordinary 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.

The Company has elected to impose the restrictions described below on the issue and on the future trading of the Ordinary Shares so that the Company will not be required to register the offer and sale of the Ordinary 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 Ordinary 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 Ordinary Shares. The Company and its agents will not be obligated to recognise any resale or other transfer of the Ordinary 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 Ordinary 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 Ordinary 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 Ordinary Shares in the United States. The Ordinary 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 Ordinary 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.

15. General

Subject to their right of withdrawal pursuant to Article 23(2) of the 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 Ordinary 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 Prospectus Regulation after the publication of a supplementary prospectus 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 Ordinary Shares to such applicant becoming unconditional and in such event investors are recommended to seek independent legal advice.

PART 10 PLACING PROGRAMME

1. 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 C Shares issued pursuant to the Issue and the Placing Programme and including the Company's existing subscriber share, may not exceed 400 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 the Ordinary Shares and to raise further money for investment in accordance with the Company's investment policy.

2. Background to and reasons for the Placing Programme

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 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 12 (General Information) of this Prospectus.

Shareholder authority to issue further Ordinary Shares and/or C Shares on a non-pre-emptive basis was granted on 6 January 2020. In utilising its discretion under the Placing Programme and seeking such authorities in the future 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.

3. 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) maintain 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) enhance the NAV per Ordinary Share of existing Ordinary Shares through new share issuance of New Ordinary Shares, as New Ordinary Shares are intended to be issued at a premium of at least one per cent. to the last published cum income NAV per Ordinary Share;
(c) grow the Company, thereby spreading operating costs over a larger capital base which should reduce the total expense ratio; and
(d) improve liquidity in the market for the Ordinary Shares.

4. Voting dilution

If 200 million New Ordinary Shares or C Shares are issued pursuant to the Placing Programme, assuming the Issue has been subscribed as to 200 million Ordinary Shares, there would be a dilution of 50 per cent. in Shareholders' voting control of the Company immediately after the Issue (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, there will be no dilution in the NAV per Ordinary Share as a result of any subsequent issue under the Placing Programme.

5. The Placing Programme

The Placing Programme will open on 6 February 2020 and will close on 6 January 2021. 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 400 million Shares less any Ordinary 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 New Ordinary 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 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–preemptive 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);
(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.

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 or where any significant new factor or significant change has arisen 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 change(s) or the significant new factors(s) 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) in the case of New Ordinary Shares, the Placing Programme Price being determined by the Directors as described below;
(b) Admission of the New Ordinary Shares or C Shares being issued pursuant to such issue;
(c) 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
(d) a valid supplementary prospectus being published by the Company if such is required by the 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 one 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 an initial NAV of 100p per Ordinary Share, the Placing Programme Price per New Ordinary Share would be expected to be at least 101p, and the expenses indirectly borne by an investor in such New Ordinary Shares would be at least 1p per Ordinary Share.

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 14 (Terms and conditions of Application under the Initial Placing and the Placing Programme) of this Prospectus.

The Company, the AIFM, the Investment Adviser and 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 Placees 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 Placee.

10. Programme Admission and dealings

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

The ISIN number of the Ordinary Shares is GB00BKLGLS10 and the SEDOL code is BKLGLS1. The ISIN number of the C Shares is GB00BKLGLT27 and the SEDOL code is BKLGLT2.

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 £101 million are raised under the Placing Programme before expenses solely through the issue of New Ordinary Shares, a Placing Programme Price of 100p per New Ordinary Share and costs of the Placing Programme of approximately one per cent. of the gross proceeds, the gross proceeds would be £101 million, and the net proceeds of the Placing Programme would therefore be £100 million.

12. Use of proceeds

The net proceeds of the Placing Programme will be invested by Rising Sun on behalf of the Company in accordance with the Company's published investment policy or used to fund the Company's operational expenses.

13. Scaling back

The Directors are authorised to issue and allot up to 400 New Ordinary Shares and/or C Shares, less any Ordinary Shares issued pursuant to the Issue, pursuant to the Placing Programme. To the extent that commitments under the Placing Programme exceed 400 New Ordinary Shares and/or C Shares in aggregate, (inclusive of Ordinary 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 RNS announcement.

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.

14. 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 Ordinary Shares, including further identification of the applicant(s) before any New Ordinary 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 Ordinary 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 Ordinary Shares.

15. 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, New Ordinary 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 Ordinary Shares so that the Company will not be required to register the offer and sale of the New Ordinary 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 New Ordinary 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 New Ordinary Shares. The Company and its agents will not be obligated to recognise any resale or other transfer of the New Ordinary Shares made other than in compliance with the restrictions described below.

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

PART 11 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 comments apply only to Shareholders who are the beneficial owners of their Shares.

1. The Company

UK

The Company has obtained from HMRC approval as an investment trust. It is the intention of the Directors to conduct the Company's affairs so that it qualifies to receive approval as an investment trust and continues to be so approved. Neither the Adviser 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 will be generally exempt from UK tax on capital 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).

Other (non-dividend) income received by the Company will, after deduction of allowable management fees and any other allowable costs, normally be subject to UK corporation tax at 19 per cent. (expected to fall to 17 per cent. from April 2020).

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

Japan

Neither the Company nor the Adviser 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 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 UK tax resident refers to any person who, under the law of the UK, is liable to tax by reason of his place of incorporation, place of head or main office, place of management or other criterion. In addition, to be entitled to the treaty benefits granted by the provisions under the articles of dividend, interest, royalty, capital gain and other income, the tax resident should be a qualified person, such as a company with the principal class of its shares being listed, registered or admitted to dealing on a recognised stock exchange (e.g. the London Stock Exchange).

Accordingly, the Company expects to be treated as both UK tax resident under the UK-Japan tax treaty and a qualified person and therefore entitled to relief 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 reduced to five per cent. if the Company owns (directly or indirectly) at least 10 per cent. of the voting power of the Japanese company paying the dividends. To qualify for this relief, the Company must not have any permanent establishment in Japan 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. To qualify for this exemption, the Company must not have any permanent establishment in Japan 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 organized under the laws of 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 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 50 per cent. or more of real estate assets in Japan) as of the last day of the fiscal year prior to the year of sale, then any gain on the sale of those shares is subject to 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 tax in Japan.

Any capital gains made by the Company should be exempt from the Japanese corporate tax under the UK-Japan tax treaty, subject to the treaty requirements and tax filing, provided that the capital gain is not 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. 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 (e.g., Dalton Advisory KK) 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 tax would be approximately 30.62 per cent. (if the Company has a paid-up capital of over JPY100 million).

2. 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 investors 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.

UK-resident companies should normally be exempt from corporation tax on dividends received from the∞Company.

Non-UK residents will 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 higher 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 should treat an interest distribution received for corporation tax purposes as if it were interest on a creditor loan relationship.

Non-UK-residents will not be subject to any UK withholding tax on interest distributions. They may be taxed differently in their own jurisdiction or the distributions may be treated as dividends. Non- residents 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 (£12,000 in tax year 2019-20) may be liable to capital gains tax at 10 per cent. (for a gain falling within the basic rate tax band) or 20 per cent. (higher and additional rate gains).

For UK resident companies any chargeable gain will be within the charge to corporation tax. Allowable losses may generally be set against chargeable gains in the same or a later period.

ISAs and SIPPs

As it is a listed company, it is expected that Shares in the Company will be qualifying assets for stocks and shares ISAs and permitted investments for SIPPs.

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 will 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 12 GENERAL INFORMATION

1. 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". The Company is registered as an investment company under section 833 of the Act. The Company has an indefinite life.
(b) The principal legislation under which Ordinary Shares have been created and the Company operates is the Companies Act 2006. As a listed investment company, the Company will not be regulated as a collective investment scheme by the FCA. However, from the Admission, the Ordinary Shares will be admitted to trading on the Specialist Fund Segment of the Main Market of the London Stock Exchange. The principal legislation under which the Company operates is the Act. The Company will also be subject to the Prospectus Regulation, the Prospectus Regulation Rules, the Disclosure Guidance and Transparency Rules, the Takeover Code, the Market Abuse Regulations 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 Directors confirm that, since the date of incorporation of the Company, the Company has not commenced operations, has no material assets or liabilities, and therefore no financial statements have been made up as at the date of this Prospectus. The Company's accounting period will terminate on 31 December of each year. The first accounting period will run from the Company's incorporation, ending on 31 December 2020.
(d) The Company is in the process of appointing its statutory auditor and expects to appoint its preferred firm, PricewaterhouseCoopers LLP, which is a member of the Institute of Chartered Accountants in England and Wales, shortly following First Admission. The annual report and accounts will be prepared according to accounting standards laid out under IFRS.
(e) The address of the registered office and principal place of business of the Company is Mermaid House, 2 Puddle Dock, London EC4V 3DB 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) As at the date of this Prospectus, the Company has not commenced operations and no financial statements in respect of the Company have been made up.
(h) The Company has no subsidiary or parent undertakings, associated companies and neither owns nor leases any premises.
(i) 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.
(k) 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.

2. Share capital

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

	Nominal value	Number
	(£)
Redeemable Preference Shares	1.00	50,000
Ordinary Shares	0.01	1

The Ordinary Share and the Redeemable Preference Shares were issued on incorporation of the Company. The Ordinary Share is fully paid up and is held by Rising Sun. To enable the Company to obtain a certificate of entitlement to conduct business and to borrow under Section 761 of the Act, 50,000 Redeemable Preference Shares were allotted to Rising Sun. On 6 January 2020, 50,000 Redeemable Preference Shares were transferred by Rising Sun for nil value to Kings Bay Investment Company Ltd, a company affiliated to a member of the Rising Sun Management Team.

The Redeemable Preference Shares are paid up as to one quarter of their nominal value. Conditional upon but effective immediately prior to First Admission, the Redeemable Preference Shares will be sub-divided and redesignated as Ordinary Shares pursuant to the Share Conversion. The Company has received an undertaking from Kings Bay Investment Company Ltd that on the Share Conversion becoming effective they will pay up the amount on each new Ordinary Share created by the Share Conversion to 100 pence per Ordinary Share. The payment to the Company by Kings Bay Investment Company Ltd therefore represents Kings Bay Investment Company Ltd's participation in the Initial Placing at the Issue Price and application will be made for these Ordinary Shares to be admitted to trading together with all the other Ordinary Shares in issue at First Admission.

2.2 Set out below is the issued share capital of the Company as it will be immediately following the Issue (assuming that the Issue is subscribed as to £200 million):

	Nominal value (£)	Number
Ordinary Shares	2,000,000.01	200,000,001

All Ordinary Shares will be fully paid.

2.3 By ordinary and special resolutions of the Company passed on 6 January 2020:
(a) THAT the Directors be and are hereby generally and unconditionally authorised in accordance with section 551 of the Act to exercise all the powers of the Company to allot up to 400 million Ordinary Shares, less the number of Ordinary Shares equal to the number of Ordinary Shares created by the Share Conversion, in connection with the issue of Ordinary Shares pursuant to the conditional placing by Shore Capital of Ordinary Shares described this Prospectus and the offer for subscription to the public in the UK of Ordinary Shares, in each case on the terms and subject to the conditions set out in the Prospectus, such authority to expire immediately following the date of Admission in respect of the Issue (unless sooner revoked or varied by the Company in a general meeting), 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 shares in pursuance of such an offer or agreement as if such authority had not expired.
(b) THAT the Directors be and are hereby generally and unconditionally authorised in accordance with section 551 of the Act to exercise all the powers of the Company to allot up to 400 million Ordinary and/or C Shares in aggregate, including within such limit any Ordinary Shares issued under the authority in paragraph a) above or created pursuant to the Share Conversion following Admission, such authority to expire on the day prior to the first anniversary of the publication date of the Prospectus (unless sooner revoked or varied by the Company in a general meeting), 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 shares in pursuance of such an offer or agreement as if such authority had not expired.
(c) THAT, on the expiry of the authorities in paragraphs (a) and (b), the Directors be and are generally and unconditionally authorised in accordance with section 551 of the Act to exercise all the powers of the Company to allot Ordinary Shares and/or C Shares with a nominal value of up to 20 per cent. of the aggregate nominal value of the Company's issued share capital immediately following Admission, to such persons and at such times and on such terms as they think proper, such authority to expire at the conclusion of the annual general meeting of the Company to be held in 2021 (unless sooner revoked or varied by the Company in a general meeting), 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 shares in pursuance of such an offer or agreement as if such authority had not expired.
(d) THAT the Company be and is hereby 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 the maximum number of Ordinary Shares authorised to be purchased is 14.99 per cent. of the issued Ordinary Shares immediately following Admission in respect of the Issue. The minimum price which may be paid for an Ordinary Share is £0.01. The maximum price which may be paid for an Ordinary Share shall be the higher of:
(i) five per cent. above the average of the mid-market values of the Ordinary Shares for the five Business Days before the purchase is made (where ''Business Days'' is any day on which the London Stock Exchange is open for business and banks are open for business in London (excluding Saturdays and Sundays); and
(ii) that stipulated by the regulatory technical standards adopted by the EU pursuant to the Market Abuse Regulation from time to time.

Such authority will expire on the earlier of the conclusion of the first annual general meeting of the Company and the date which is 18 months after the date on which the resolution was passed that the Company may contract to purchase its Ordinary Shares under the authority hereby conferred prior to the expiry of such authority, which contract will or may be executed wholly or partly after the expiry of such authority and may purchase its Ordinary Shares in pursuance of such contract.

(e) THAT the Directors be and are hereby generally empowered (pursuant to section 570 of the Act) to allot Ordinary Shares for cash pursuant to the authority referred to in paragraph (a) above as if section 561 of the Act did not apply to any such allotment, such power to expire immediately following Admission in respect of the Issue, save that the Company may before such expiry make an offer or agreement which would or might require Ordinary Shares to be allotted after such expiry and the Directors may allot equity securities in pursuance of such offer or agreement as if the power had not expired.
(f) THAT the Directors be and are hereby generally empowered (pursuant to section 570 and 573 of the Act) to allot Ordinary Shares and C Shares and to sell Ordinary Shares from treasury for cash pursuant to the authority referred to in paragraph (b) above as if section 561 of the Act did not apply to any such allotment or sale, such power to expire at the conclusion of the first annual general meeting of the Company, save that the Company may, at an time prior to the expiry of such power, make an offer or enter into an agreement which would or might require equity securities to be allotted or sold from treasury after the expiry of such power, and the Directors may allot or sell from treasury equity securities in pursuance of such an offer or an agreement as if such power had not expired.
(g) THAT the Directors be and are hereby generally empowered (pursuant to section 570 and 573 of the Act) to allot Ordinary Shares and/or C Shares and to sell Ordinary Shares from treasury for cash pursuant to the authority referred to in paragraph (c) above as if section 561 of the Act did not apply to any such allotment or sale, such power to expire at the conclusion of the annual general meeting of the Company to be held in 2021 (unless sooner revoked or varied by the Company in a general meeting), save that the Company may before such expiry make an offer or agreement which would or might require Ordinary Shares and/or C Shares to be allotted after such expiry and the Directors may allot equity securities in pursuance of such offer or agreement as if the power had not expired.
(h) THAT, subject to and with effect from immediately prior to Admission, in accordance with section 618 of the Companies Act 2006, the 50,000 Redeemable Preference Shares of £1.00 each in the issued share capital of the Company be sub-divided into 5,000,000 Redeemable Preference Shares of £0.01 each (the "Sub-Division"), such shares having the same rights and being subject to the same restrictions (save as to nominal value) as the existing Redeemable Preference Shares of £1.00 each in the capital of the Company as set out in the Company's articles of association for the time being.
(i) THAT, subject to and with effect from immediately prior to Admission but only effective immediately following the Sub-Division authorised pursuant to the resolution set out in paragraph f), each of the 5,000,000 Redeemable Preferences of £0.01 each in issue in the capital of the Company be re-designated Ordinary Shares of £0.01 each, such Ordinary Shares having the respective rights set out in the articles of association of the Company for the time being.
(j) THAT conditional upon Admission and subject to the confirmation of the Court, the amount standing to the credit of the share premium account of the Company immediately following completion of the Issue be cancelled, and the amount of the share premium account so cancelled be credited to a reserve.
(k) THAT new articles of association are approved and adopted as the articles of association of the Company in substitution for, and to the exclusion of, the existing articles of association.
2.4 The provisions of section 561 of the Act (which, to the extent not disapplied pursuant to section 570 or section 573 of the Act, confer on Shareholders rights of pre-emption in respect of the allotment or sale of equity securities for cash) shall apply to any unissued share capital of the Company, except to the extent disapplied by the resolutions referred to in paragraphs (d), (e) and (f) above.
2.5 The Directors are entitled to exercise all powers of the Company to issue Shares in the Company under the Articles and are expected to resolve to do so prior to First Admission in respect of the Ordinary Shares to be issued pursuant to the Issue.
2.6 As at the date of this Prospectus:
(a) no subscriptions, issues or options are to be given by the Company, or are already existing, in respect of any securities of the Company, including any that have a prior right over the Ordinary Shares to a distribution of the profits or assets of the Company;
(b) no shares which do not represent capital have been issued by the Company and remain outstanding;
(c) no shares are held by or on behalf of the Company in treasury or otherwise;
(d) no convertible securities, exchangeable securities or securities with warrants have been issued by the Company and remain outstanding; and
(e) save in connection with the Issue there are no acquisition rights and/or obligations over any of the Company's authorised but unissued capital and no undertakings to increase the Company's capital.
2.7 Since the Company's incorporation, save for the Ordinary Shares issued to Rising Sun referred to in paragraph 3.1 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, save in connection with the Issue, 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, may 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 dividend as from a particular date, it shall rank for dividend 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.

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 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 within 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
(g) 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 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) of the Company, 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 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:

$$
Conversion Ratio = \frac{A}{B}
$$

$$
\mathbf{A} = \frac{C-D}{E}
$$

$$
\mathbf{B} = \frac{F - C - I - G + D + J}{H}
$$

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);

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, 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 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 not confer the right to participate in any surplus remaining following payment of such amount; and

(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

(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 moneys 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.
(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.

4.2 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.

4.3 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.

The following Directors intend to subscribe for the following number of Ordinary Shares under the Offer for Subscription:

Director	Ordinary Shares
Rosemary Morgan*	40,000
Chetan Ghosh	30,000
Rachel Hill	40,000

Alicia Ogawa and Ayako Weissman have expressed an intention to acquire 27,000 Ordinary Shares each in the secondary market shortly after First Admission.

*20,000 Ordinary Shares will be registered in the name of Rosemary Morgan and 20,000 Ordinary Shares will be registered in the name of Rosemary Morgan's husband.

(b) 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.
(c) No share or loan capital of the Company is under option or is agreed conditionally or unconditionally to be put under option.
(d) 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.

Conditional upon First Admission of the Ordinary Shares to be issued pursuant to the Issue, the Directors will be 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 Chetan Ghosh Rachel Hill Alicia Ogawa Ayako Weissman	£35,000 £30,000 £27,000 £27,000 £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 current financial period ending 31 December 2020 is estimated to be approximately £146,000.

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.

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	Dalton Asia (Offshore
	(Europe) Limited	Feeder) Fund Ltd.
	DC Developing Market
	Strategies PLC
	Quaero Capital Funds (Lux)
	Talos Investment Fund SICAV
Alicia Ogawa	Misaki Engagement Fund	None
	Misaki Engagement Fund II
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.

The Company shall maintain directors' and officers' liability insurance on behalf of the Company at the expense of the Company.

5.5 Major Shareholders

Pending the allotment of Ordinary Shares pursuant to the Issue, the Company is controlled by Rising Sun, which directly holds the Company's only issued Ordinary Share and therefore 100 per cent. of the voting rights in the Company. On First Admission, 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.

Major shareholders will 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 and the participations in the Issue by the Directors and members of the Rising Sun Management Team described below, the Company is not a party to, nor has any interest in, any related party transaction (as defined in the standards adopted according to the Regulation (EC) No. 1606/2002).

The Directors and members of the Rising Sun Management Team have agreed to acquire Ordinary Shares in the Issue, or have expressed an intention to acquire Ordinary Shares in the secondary market shortly after First Admission, in the amounts set out in paragraph 5.1 and paragraph 4.2 respectively of this Part 12.

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 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 will provide 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 First Admission. 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 First Admission;
(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 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.

6.2 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 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 First Admission, 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 will also be 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.

6.3 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. The Administrator will also be entitled to fees in connection with the launch of the Company of £20,000. 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);
(c) the Administrator will also be entitled to reimbursement of reasonable and properly incurred third party expenses;
(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.

6.4 Placing Agreement

In connection with the Initial Placing and any Subsequent Placing, the Company, the Directors, Rising Sun, Rosenwald Capital and Shore Capital entered into the Placing Agreement on 7 January 2020. The Placing Agreement is conditional on, among other things, First Admission taking place on 5 February 2020 or such later date (not being later than 8:00 a.m. on 28 February 2020) 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 Placees to subscribe for Ordinary 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 Rosenwald Capital for certain of their properly incurred costs and expenses of and incidental to the Issue and related arrangements together with any applicable VAT;
(d) although Rosenwald Capital have agreed to pay the corporate finance fee, the placing commission and the expenses incurred by Shore Capital in connection with the Issue, Shore Capital are entitled to deduct such amounts from the placing proceeds received by Shore Capital

in respect of the Issue. Accordingly, to ensure that the net proceeds from the Issue are 100p per Ordinary Share, Rosenwald Capital has undertaken to reimburse the Company for any amounts deducted by Shore Capital in accordance with the Placing Agreement;

(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 and the Directors have given certain warranties in relation to themselves. 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, 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 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.

6.5 Registrar's Agreement

The Registrar's Agreement dated 16 December 2019 between the Company and 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.

6.6 Receiving Agent Agreement

The receiving agent agreement is dated 16 December 2019 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.

6.7 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.

6.8 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, will provide 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.

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.

7. 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 since the Company's incorporation.

8. 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 its incorporation.

9. 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. Such information has been accurately reproduced and, as far as the Company and Rising Sun is able to ascertain from information published by such third parties, no facts have been omitted which would render the reproduced information inaccurate or misleading.

10. 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 intends to form one or more subsidiaries for the purposes of its business.

11. Working capital

In the Company's opinion, taking into account the minimum net proceeds raised from the Issue will be £100 million, the working capital is sufficient for the Company's present requirements (that is for at least 12 months following the date of this Prospectus).

12. Capitalisation and indebtedness

Details of capitalisation are set out in paragraph 2 of this Part. 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.

The following table shows the Company's unaudited indebtedness (distinguishing between guaranteed and unguaranteed, secured and unsecured indebtedness) and the Company's unaudited capitalisation as at the date of this Prospectus.

7 January 2020
£
0
0
0
0 ––––––––––
0 –––––––––– ––––––––––

0
0
0 ––––––––––
0 –––––––––– ––––––––––

	7 January 2020
	£
Shareholders' equity
Share capital	50,000.01
Legal reserve	0
Other reserves	0 ––––––––––
Total Shareholders' equity	50,000.01 –––––––––– ––––––––––

As at the date of this Prospectus, there has been no material change in the unaudited capitalisation of the Company.

	7 January 2020 £
A Cash B Cash equivalent C Trading Securities	0 0 0 ––––––––––
D Liquidity	0 ––––––––––
E Current financial receivables	0 ––––––––––
F Current bank debt G Current position of non-current debt H Other current financial debt	0 0 0 ––––––––––
I Current financial debt (F) + (G) + (H)	0 ––––––––––
J Net current financial indebtedness (I) – (E) – (D)	0 ––––––––––
K Non-current bank loans L Bonds issued	0 0 ––––––––––
M Other non-current loans	0 ––––––––––
N Non-current loans (K) + (L) + (M)	0 ––––––––––
O Net financial indebtedness (J) + (N)	0 –––––––––– ––––––––––

There are no indirect or contingent liabilities.

13. Availability of Prospectus

A copy of this Prospectus will be available for inspection at The National Storage Mechanism which is located at http://www.morningstar.co.uk/uk/nsm 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 Mills & Reeve LLP, 24 King William Street, London EC4R 9AT, from the date of this Prospectus until the end of the Placing Programme:

(a) this Prospectus; and

(b) the Memorandum and Articles.

These documents will also be available on the Company's website.

15. Intermediaries

The intermediaries authorised as at the date of this Prospectus to use this Prospectus in connection with the Intermediaries Offer are:

1 AJ Bell Securities Limited
1. Albert E Sharp LLP
1. Equiniti Financial Services Ltd
1. iDealing.com Ltd
1. Interactive Investor Services Limited

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 13 DEFINITIONS AND INTERPRETATION

1. Definitions

In this Prospectus, unless the context otherwise requires, the expressions as set out below shall bear the following meanings:

Act	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 6.3 of Part 12 (General Information) of this Prospectus;
Administrator	PraxisIFM Fund Services (UK) Limited;
Admission	the date on which admission of Ordinary 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 AIFM Directive;
AIFM	alternative investment fund manager, as defined in the AIFM Directive;
AIFM Agreement	the agreement between the Company and the AIFM, a summary of which is set out in paragraph 6.2 of Part 12 (General Information) of this Prospectus;
AIFM Directive*	the Alternative Investment Fund Managers Directive (2011/61/ EU);
AIFM Regulations	the Alternative Investment Fund Managers Regulations 2013 (SI) 2013/1773);
AIFM Rules	the AIFM Directive, the EU Regulation 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 12 (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);
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 12 (General Information) of this Prospectus;
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);
Dalton	Dalton Investments LLC;
Dalton Clients	has the meaning given to it in paragraph 5 of Part 6 (Information on the Company);
Default Shares	has the meaning given to it in paragraph 3.9 of Part 12 (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 Regulation	the Commission Delegated Regulation (EU) No 231/2013 of 19 December 2012 supplementing the AIFM Directive, with regard to exemptions, general operating conditions, depositaries, leverage, transparency and supervision;
Euroclear UK & Ireland Limited	(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;
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;

the U.S. Foreign Account Tax Compliance Act of 2010; FATCA
FCA	the Financial Conduct Authority;
FCA Rules	the handbook of rules and guidance of the FCA, as amended;
First Admission	the date on which admission of 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	Financial Services and Markets Act 2000, as amended;
GDPR	the General Data Protection Regulation (EU) 2016/679;
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;
Initial Placing	the conditional placing by Shore Capital of Ordinary Shares (including the Ordinary Shares to be held by Kings Bay Investment Company Ltd pursuant to and following the Share Conversion) described in this Prospectus in connection with the Company's IPO, on the terms and subject to the conditions set out in the Placing Agreement and this Prospectus;
Intermediaries Booklet	the booklet containing, among other things, the Intermediaries Terms and Conditions;
Intermediaries	the entities listed in paragraph 15 of Part 12 (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 Offer	the offer of Ordinary 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 6.1 of Part 12 (General Information) of this Prospectus;
Investment Company Act	the United States Investment Company Act of 1940, as amended;
IPO	initial public offering;
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 Ordinary Shares pursuant to the Initial Placing, the Offer for Subscription and the Intermediaries Offer in each case at the Issue Price together with the new Ordinary Shares created pursuant to the Share Conversion;
Issue Expenses	the costs, commissions, fees and expenses incidental to the formation of the Company and the completion of the Issue which will be borne and paid by Rosenwald Capital on or around First Admission;
Issue Price	100p per Ordinary Share;
IT Regulations	Investment Trust (Approved Company) (Tax) Regulations 2011;
Key Information Document	the key information document dated on or around the date of this Prospectus relating to the Company produced pursuant to the 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;
Market Abuse Regulation*	the Market Abuse Regulation (EU) No. 596/2014;
Memorandum	the memorandum of incorporation of the Company;
MiFID II	Directive 2014/65/EU of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments and amending Directive 2002/92/EC and Directive 2011/61/EU (''MiFID'') and Regulation (EU) No 600/2014 of the European Parliament and the Council of 15 May 2014 on markets in financial instruments and amending Regulation (EU) No 648/ 2012 (''MiFIR'', and together with MiFID, ''MiFID II");
MiFID II Product Governance Requirements	has the meaning given in Part 2 (Important Information) of this Prospectus;
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 shares of that class 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 shares of that class 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 Placing Programme or arising upon conversion of any C Shares issued pursuant to the Placing Programme;
OECD Member State	means a member of the Organisation for Economic Co-operation and Development;

Offer for Subscription	the offer for subscription to the public in the UK for Ordinary Shares on the terms and subject to the conditions set out in this Prospectus;
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, the Directors and Shore Capital, details of which are set out in paragraph 6.4 of Part 12 (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 400 million less the number of Ordinary Shares issued under the Issue as described in this document;
Placing Programme Price	in the case of New Ordinary Shares, such price at which the New Ordinary Shares will be issued to placees 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 6 of Part 10 (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;
PRIIPs Regulation	Regulation EU No. 1286/2014 on key information documents for packaged retail and insurance-based products;
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 6.8 of Part 12 (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*	Regulation 2017/1129 on the prospectus to be published when securities are offered to the public or admitted to trading on a regulated market, as amended from time to time;
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 6.5 of Part 12 (General Information) of this Prospectus;
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 of Part 12 (General Information) of this Prospectus;
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 12 (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;
Reporting Accountant	PricewaterhouseCoopers LLP;
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	James B. Rosenwald, III (together with his family and related trusts), the Dalton Clients, certain members of the Rising Sun Management Team and their associates or connected persons together with group companies of Shore Capital;
Rosenwald Capital	Rosenwald Capital Management, Inc.
Rule 144A	Rule 144A under the Securities Act;
Securities Act	the United States Securities Act of 1933, as amended;
Share Conversion	the sub-division and redesignation of the 50,000 Redeemable Preference Shares in issue as at the date of this Prospectus into 5,000,000 Ordinary Shares to take place conditional upon, and effective immediately prior to, First Admission;
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 form 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 6 of Part 10 (The Placing Programme) of this Prospectus;
Subsequent Placing	a placing of Shares pursuant to the Placing Programme;
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 Listing Authority	the FCA as the competent authority for the approval of Prospectuses in the United Kingdom;
VAT	value added tax; and
Website	www.nipponactivevaluefund.com.

2. Interpretation

In this Prospectus, any reference to Ordinary Shares being issued and/or allotted in connection with the Issue shall include Ordinary Shares being created upon the Share Conversion which shall become effective conditional upon, and immediately prior to, First Admission.

With effect from the date and time on which the UK formally ceases to be a member of the EU, if the UK has not entered into any agreement with the EU pursuant to Article 50 of the Treaty of Lisbon to set out the terms of the UK's withdrawal from the EU, references to terms marked with an asterisk in this Part shall be taken to refer to the equivalent or replacement law applying to persons in the UK.

PART 14 TERMS AND CONDITIONS OF APPLICATION UNDER THE INITIAL PLACING AND THE PLACING PROGRAMME

1. 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 14, a "Placee") will be bound by these terms and conditions and will be deemed to have accepted them.

Each of 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 14, a "Placing Letter"). The terms of this Part 14 will, where applicable, be deemed to be incorporated into that Placing Letter.

2. Agreement to Subscribe for Placing Shares

Conditional on, amongst other things: (i) First Admission occurring and becoming effective by 8:00 a.m. (London time) on or prior to 5 February 2020 (or such later time and/or date, not being later than 8:00 a.m. on 28 February 2020 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 6 January 2021; (ii) in the case of the Initial Placing, the minimum net proceeds of £100 million being raised pursuant to the Issue; (iii) in the case of any issue under a Subsequent Placing, to the extent required by Article 23(1) of the 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.

3. 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, as applicable, the relevant Placee shall be deemed hereby to have irrevocably and unconditionally appointed Shore Capital, as applicable, 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.

4. 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 14, 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 14 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 14 (for the purposes of this Part 14, 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 neither Shore Capital, the Investment Adviser, the Registrar, nor any person acting on their behalf nor any of their 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 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 14 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 14 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 14 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 14 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, including the United Kingdom, 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, including the United Kingdom, 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;
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 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 (other than the United Kingdom), it is (a) a "qualified investor" within the meaning of Article 2(e) of the Prospectus Regulation; and (b) otherwise permitted to be marketed to in accordance with the provisions of the 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 Prospectus Regulation: (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 any relevant Member State other than qualified investors, as that term is defined in the Prospectus Regulation, 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 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 Prospectus Regulation 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 14, 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 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 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 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, including the United Kingdom, 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 the FSMA) relating to the Ordinary Shares and C Shares only in circumstances in which section 21(1) of the 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 the 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 the 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 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 neither 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 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 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 listing on the Official List and to trading on the Main Market 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 and 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;
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, and the Privacy

and Electronic Communications (EC Directive) Regulations 2003, 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 the 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 14, "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 14 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;
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 it 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 Prospectus Regulation and in the event that it chooses to exercise any right of withdrawal pursuant to Article 23(2) of the Prospectus Regulation, such Placee will immediately re-subscribe for the Ordinary Shares and/or C Shares previously comprising its Placing Commitment;
4.1.46 the Initial Placing will not proceed if the proceeds would be less than £100 million; and
4.1.47 the commitment to subscribe for Ordinary Shares and/or C Shares on the terms set out in this Part 14 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 14.

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 QIB, 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;
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 intent 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 (as defined in Regulation S) 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 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 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;
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 ex ercise 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.

PART 15 TERMS AND CONDITIONS OF APPLICATION UNDER THE OFFER FOR SUBSCRIPTION

1. Introduction

If you apply for Ordinary 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 15.

2. Terms and conditions for Applicants using the Offer for Subscription Application Form

2.1 Offer to acquire Ordinary 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 Ordinary Shares 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 Share on the terms, and subject to the conditions, set out in this Prospectus (including this Part 15) and the Articles;
(b) agree that in respect of any Ordinary 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 Ordinary 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 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 Ordinary Shares applied for in uncertificated form credited to a CREST account or to receive a share certificate for any Ordinary Shares applied for in certificated form or to enjoy or receive any rights in respect of such Ordinary Shares unless and until you make payment in cleared funds for such Ordinary 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 Ordinary 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 Ordinary Shares in uncertificated form to which you may become entitled may be delayed by, and that any share certificate in respect of any Ordinary 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;
(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 15 or any other suspected breach of the terms and conditions of application set out in this Part 15; 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 Ordinary Shares and, in such case, the Ordinary 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 15 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 5 of the Application Form with the number of Ordinary Shares for which your application is accepted or, if that section is not completed, send a definitive certificate in respect of the number of Ordinary 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 Ordinary 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 the General Data Protection Regulation 2016/679 (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 connection with its holding of Ordinary 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 Ordinary 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 Ordinary 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 15. 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 28 January 2020.
(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.

(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 8RA15 by no later than 1:00 p.m. on 4 February 2020, allowing for the delivery and acceptance of Ordinary 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 5 February 2020 (or such later time or date, not being later than 8:00 a.m. on 28 February 2020, as the Company and Shore Capital may agree); and
(b) the Placing Agreement referred to in paragraph 6.4 of Part 12 (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 moneys

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 if any contract created by acceptance does not become unconditional, the application moneys 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 15 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 Ordinary 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 Ordinary 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 pursuant to the PRIIPs Regulation 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 Key Information Document via the website at www.nipponactivevaluefund.com, or on such other website as has been notified to you. Where your application is made on an advised basis or through another intermediary, the terms of your engagement should address the means by which the Key Information Document will be provided to you.

(d) agrees that, having had the opportunity to read the Prospectus and the Key Information Document, it shall be deemed to have had notice of all information and representations concerning the Company and the Ordinary 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 Ordinary 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 (depositary 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 professionallyadvised 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 identify 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 15, verification of the identity of applicants will be required if the value of the Ordinary 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 Ordinary Shares, whether in one 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 Ordinary 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 Ordinary Shares under the Offer for Subscription. It is the responsibility of all such persons receiving this Prospectus and/or wishing to subscribe for Ordinary 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 Ordinary 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 Ordinary Shares and the Offer for Subscription.
(b) The rights and remedies of the Company, Shore Capital and the Receiving Agent, pursuant to this Part 15 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 28 January 2020 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 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 Ordinary 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 noone 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 Ordinary Shares or concerning the suitability of Ordinary 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 Ordinary Shares subscribed by you into your name(s) and authorise any representatives of the Company, the Receiving Agent Shore Capital to execute and/or complete any document required therefor.
(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 15 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 15 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 Ordinary Shares into an ISA, SIPPS or SSAS. If you are interested in transferring your Ordinary 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 Ordinary 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 Ordinary 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.

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 or (during normal business hours only) by hand to Computershare, The Pavilions, Bridgwater Road, Bristol BS13 8AE, so as to be received by no later than 1:00 p.m. on 28 January 2020. 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 28 January 2020 may be rejected and returned to the firstnamed applicant.

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 28 January 2020.

HELP DESK: If you have a query concerning completion of the Application Form please call the Receiving Agent on 03707 020 000 or from outside the UK on +44 370 702 0000.

1. APPLICATION

Fill in (in figures) in Box 1 the number of Ordinary Shares you wish to subscribe for at the Issue Price being 100 pence per Ordinary Share. 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 Ordinary 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 Ordinary Shares be deposited into a CREST account please note that payment for such Ordinary Shares must be made prior to the day such Ordinary Shares might be allotted and issued. It is not possible for an applicant to request that Ordinary 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 28 January 2020. 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 Ordinary 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 Ordinary 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 Ordinary Shares in certificated form provided payment has been made in terms satisfactory to the Company.

The right is reserved to issue your Ordinary 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 Ordinary 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 Ordinary Shares to your CREST account against payment of the Issue Price per New Share through the CREST system upon the Settlement Date.

By returning the Application Form you agree that you will do all things necessary to ensure that you or your settlement agent/custodian's CREST account allows for the delivery and acceptance of Ordinary Shares to be made prior to 8:00 a.m. on 5 February 2020 against payment of the Issue Price per Ordinary 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: 3 February 2020 Settlement Date: 5 February 2020 SEDOL: BKLGLS1 ISIN: GB00BKLGLS10

Company: Nippon Active Value Fund plc Security Description: Ordinary Shares of £0.01 each Should you wish to settle DVP, you will need to match your instructions to the Registrar's Participant account 8RA15 by no later than 1:00 p.m. on 4 February 2020.

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.

In the event of late CREST settlement, the Company, after having consulted with the Registrar, reserves the right to deliver Ordinary 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 or by hand (during normal business hours), to Computershare, The Pavilions, Bridgwater Road, Bristol BS13 8AE so as to be received no later than 1:00 p.m. on 28 January 2020, 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].

[INTENTIONALLY LEFT BLANK]

APPENDIX – 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 or by hand (during normal business hours) to Computershare Investor Services PLC, The Pavilions, Bridgwater Road, Bristol BS13 8AE so as to be received no later than 1:00 p.m. (London time) on 28 January 2020. 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 7 January 2020 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

1. APPLICATION

I/We the person(s) detailed in section 2A below offer to subscribe the amount shown in Box 1 (above) for Ordinary Shares subject to the Terms and Conditions of Application under the Offer for Subscription set out in the Prospectus dated 7 January 2020 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) ORDINARY 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):
	141

FOR OFFICIAL USE ONLY
Log No.


Box 1

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 ORDINARY SHARES ARE TO BE DEPOSITED (IF APPLICABLE)

Only complete this section if Ordinary 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:

3. 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 16 (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 Ordinary 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 Ordinary 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 Ordinary Shares and sending subscription monies by electronic bank transfer (CHAPS), payment must be made for value by 1:00 p.m. on 28 January 2020. Please contact ComputershareInvestor 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 28 January 2020, 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 Ordinary Shares to be made against payment at the Issue Price per New Share, following the CREST matching criteria set below:

Trade Date: 3 February 2020 Settlement Date: 5 February 2020 SEDOL: BKLGLS1 ISIN: GB00BKLGLS10

Company: Nippon Active Value Fund PLC Security Description: Ordinary Shares of £0.01 each

Should you wish to settle DVP, you will need to match your instructions to Computershare's Participant account 8RA15 by no later than 1:00 p.m. on 4 February 2020.

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.

5. 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:

1. 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;
1. we are regulated in the conduct of our business and in the prevention of money laundering by the regulatory authority identified below;
1. 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;
1. we confirm the accuracy of the names and residential business address(es) of the holder(s) given at section 2A;
1. 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
1. 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:

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).

Tick here for documents provided

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
(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.

7. 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:

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. Pursuant to the AIFM Directive and the UK implementing measures (the Alternative Investment Fund Managers Regulations No.1173/2013, and consequential amendments to the Financial Conduct Authority Handbook), set out below is the information required to be disclosed in accordance with Article 23 of the 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).

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.

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 a relevant member state, the choice of a 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 other country which cannot be derogated from by agreement. Shareholders should note that there are a number of legal instruments providing for the recognition and enforcement of foreign judgments in England. Depending on the nature and jurisdiction of the original judgment, Council Regulation (EC) No 44/2001 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters, Regulation (EC) No 805/2004 of the European Parliament and of the Council of 21 April 2004 creating a European Enforcement Order for uncontested claims, the Convention on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters done at Lugano on 30 October 2007, the Administration of Justice Act 1920 and the Foreign Judgment (Reciprocal Enforcement) Act 1933 may apply. There are no legal instruments providing for the recognition and enforcement of judgments obtained in jurisdictions outside those covered by the instruments listed above, although such judgments might be enforceable at common law.

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.

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

The Company has not yet formally appointed a statutory auditor for its first accounting period. Once appointed, the Company's auditor will provide audit services to the Company for each financial period.

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 under Article 9(7) of the AIFM Directive

The provisions of the 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 12 (Additional 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

As the Company has not yet commenced operation, no financial statements or Net Asset Value figures are currently available. Following First Admission, the Company's Net Asset Value will be published daily by way of RNS announcement.

The Company's historical performance

As the Company has not yet commenced operation, no historical performance information is currently available. Once published, the Company's annual and interim reports will be 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 depositary 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 6 (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 the disclosure requirements under Articles 23(4) and 23(5) of the AIFM Directive

The information required under paragraphs 4 and 5 of Article 23 of the AIFM Directive will be disclosed in the Company's audited annual report.

AI assistant

NIPPON ACTIVE VALUE FUND PLC — Regulatory Filings 2020

5034_prs_2020-01-10_8925e221-b6e3-487a-8e57-0f8400042162.pdf

NIPPON ACTIVE VALUE FUND PLC

Shore Capital

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?

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?

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?

Placing

The Intermediaries Offer

Offer for Subscription

Placing Programme

Dilution

Expenses

Why is this prospectus being produced?

PART 1

RISK FACTORS

RISKS RELATING TO THE COMPANY

The Company is a newly formed company with no operating history and no revenues, and investors have no basis on which to evaluate the Company

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

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 relating to the UK's exit from the European Union

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

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

Risk associated with pursuing an activist shareholder strategy in Japan

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

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

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

(c) Accounting

(d) Investment trust status

RISKS RELATING TO THE SHARES

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

Risks affecting the Shares

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

Further issues of Shares

Risks relating to the C Shares

PART 2

IMPORTANT INFORMATION

1. Regulatory information

NIPPON ACTIVE VALUE FUND PLC Regulatory Filings 2020