Incentive Fee Arrangements

RNS Number : 5687H

VietNam Holding Limited

18 August 2016

 

18 August 2016

VietNam Holding Limited ("VNH" or the "Company")

Incentive fee arrangements for the year ended 30 June 2016

VNH announces that, in accordance with the terms of the Investment Management Agreement (as amended) (the "IMA") between the Company and Vietnam Holding Asset Management Limited ("VNHAM"), the Company's Investment Manager, VNHAM is entitled to receive from VNH an incentive fee (the "Incentive Fee"), based on gross Net Asset Value, rewarding the investment performance of the Fund. The Incentive Fee was calculated in accordance with the terms of the IMA and for the year ending June 30, 2016 totalled US$4,542,553.

Under the terms of the IMA, VNHAM is entitled to receive 15 per cent. of the Incentive Fee in the form of an equivalent amount of ordinary shares of US$1 each in the Company ("Ordinary Shares") and VNH may use treasury shares for that purpose. For the year ending June 30, 2016, VNH and VNHAM have agreed that VNHAM will receive 30 per cent. of the Incentive Fee in the form of shares rather than 15 per cent. This deviation from the terms of the IMA only applies to the year ending June 30, 2016 and any similar revision of the agreed fee structure in the future will be subject to a specific agreement between VNH and VNHAM. The rationale behind this decision is that VNH will preserve cash and will also be able to use treasury shares otherwise due for cancellation on August 31, 2016.

Furthermore, the IMA refers to the commitment by VNHAM to donate one third of the Incentive Fee to the VNH Foundation, an independent charitable foundation registered in Switzerland and under the supervision of the Swiss Authorities. The VNH Foundation has agreed to receive 30 per cent. of that portion of the Incentive Fee in the form of Ordinary Shares. This is a one-time deviation from the terms of the IMA that state that the portion payable to VNH Foundation must be paid fully in cash; any similar deviation from the agreed donation structure in the future will be subject to a specific agreement between the VNH Foundation and VNHAM.

As part of the settlement arrangements for the Incentive Fee, the Company Directors who are entitled to a proportion of the Incentive Fee - Professor Rolf Dubs and Mr Nguyen Quoc Khanh - have agreed to an allocation lower than that set out in the IMA.

The share price calculated in accordance with the terms of the IMA for determining the number of Ordinary Shares equivalent to 30 per cent. of the Incentive Fee is US$2.157 per Ordinary Share. Accordingly, 631,684 Ordinary Shares, currently held as treasury shares, will be transferred to VNHAM.

Following this transfer, the Company will hold 9,570,338 Ordinary Shares in treasury, and will have 54,745,447 Ordinary Shares with voting rights in issue (excluding treasury shares). In addition, VNHAM will hold 889,108 Ordinary Shares representing 1.6 per cent. of the issued share capital of the Company.

A further announcement following the transfer of Ordinary Shares to the Company Directors under the IMA as described above, will be made in due course.

For further information please contact:

VietNam Holding Asset Management Limited	Tel: [phone]
Gyentsen Zatul - Investor Relations [e-mail] www.vietnamholding.com
Smith & Williamson Corporate Finance Limited Nominated Adviser Azhic Basirov / Ben Jeynes	Tel: [phone]
Winterflood Investment Trusts Broker	Tel: [phone]
Joe Winkley / Neil Langford
Buchanan Communications	Tel: [phone]
Financial Public Relations Charles Ryland /Vicky Watkins

 

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