Henderson High Income Trust PLC
24 January 2003
Henderson High Income Trust plc
Revised fund management fee arrangements
Henderson High Income Trust plc has agreed with its fund manager, Henderson
Global Investors, a revised management fee arrangement, involving a reduction in
the ad valorem management charge and the addition of a performance related fee.
In summary, the following changes will take effect from 1st January 2003:
The base ad valorem fee will be reduced from 0.6% to 0.5% per annum. This fee
will continue to be calculated as a percentage of the average value of assets
under management on the last day of each of the two years preceding the calendar
year in respect of which the calculation is made.
In addition a performance related fee has been introduced. Performance will be
measured as the average of performance of the Company's total assets (calculated
in accordance with Global Investment Performance Standards) over three years
compared with the benchmark, which is set out below. In any given year in which
a performance fee is payable, the fee rate will be increased by 0.15% for every
1% average out performance on a sliding scale. The upper limit on the total fee,
including the base fee and any performance fee, for any given accounting year
will be 1.5%. (see note below for the limits for years one and two). For
clarity, although performance will be measured over three years only the current
year's fee would be increased in the event of out performance.
The benchmark will be a composite of 75% of the performance of the FTSE All
Share Index and 25% that of the FTA Government All Stocks Index. Performance of
both the company and the index will be measured on a total return (with income
reinvested) basis. Returns for the investment trust and the FTSE All Share Index
will be measured on the basis of net income reinvested; returns for the FTA
Government All Stocks Index will be measured on a gross income basis.
The performance will be measured on a three year rolling basis. Thus, the fee
calculated as at 31st December 2005 will take the average performance over
calendar years 2003 to 2005; that at 31st December 2006 performance over 2004 to
2006 and so on.
As the annual management fee will be reduced from 1st January 2003 but the first
three year performance fee will not fall payable until following the December
2005 year end (that is, in 2006), for the first two years of the new fee
arrangement transition arrangements will be put in place as follows:
• A performance fee for the year ended 31st December 2003 ("year one"),
based on performance over the one year to that date.
• A performance fee for the year ended 31st December 2004 ("year two"),
based on performance over the two years to that date.
The overall limit for fees for year one will be 0.8%
The overall limit for fees for year two will be 1.0%
Enquiries:
William Eason, Chairman Henderson High Income 020 7818 5517
Stephen Westwood, Henderson Global Investors 020 7818 5517
This information is provided by RNS
The company news service from the London Stock Exchange
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