TFC Amendment to Investment Management AgreementDec 12, 2014 15:00
Amendment to Investment Management Agreement
St Peter Port, Guernsey, 12 December 2014 - The Forest Company Limited, a closed-ended investment company, incorporated and registered in Guernsey, announces that, following discussion with major shareholders, the Company has entered into an amended and restated investment management agreement with Timber Capital Limited ("TCL"), its appointed investment manager, to reflect an amendment to the way in which performance fees are calculated.
Pursuant to this amendment, the changes in the Company's adjusted net asset value per share for the purposes of calculating performance fees ("Performance Fees") due to TCL will be measured over a series of successive three year periods (each a "Calculation Period") instead of on an annual basis. The first Calculation Period will run from 31 December 2013 to 31 December 2016. As under the previous investment management agreement, the master hurdle amount shall increase at an annual compounding hurdle rate of 8 per cent. starting from the 31 December 2013 adjusted net asset value, and will be adjusted, as previously, to reflect new share issuances by the Company and payments of dividends and will be subject to a "high water mark" adjustment.
Where a Performance Fee is payable, it will be paid by the Company to TCL in three equal instalments with the first payment due following the approval by the Board of the consolidated annual accounts for the Company for the final day of the relevant Calculation Period. The second and third instalments will be paid on the first and second anniversaries respectively of the first instalment payment. Interest will be paid by the Company on the second and third instalments at the applicable US dollar LIBOR rate.
About The Forest Company:
The Forest Company combines socially and environmentally responsible forestry investments with unique potential for stable and attractive returns through participation in the value chain of competitive and sustainable industries.
The Forest Company Limited is a closed-ended investment company, incorporated and registered in Guernsey in 2007, to take advantage of investment opportunities in trees, timberland and timber related assets. The Company focuses on forest plantations in areas with high biological growth rates, such as Brazil and Colombia. To date The Forest Company has raised USD 355 million in equity capital through private placements to institutional investors and family offices. Thus far, the Company has committed capital to five projects, which include both greenfield and standing plantations located in Brazil and Colombia.
The Company aims to build a diversified timberland portfolio in terms of age, class and species that is intended to maximise the risk/return profile. The Company believes that this approach will generate both long-term capital appreciation for shareholders and an attractive and sustainable income yield. For more information, visit www.theforestcompany.se.
Timber Capital Limited is the investment manager to The Forest Company.
For additional information, please contact:
ir@theforestcompany.se, The Forest Company, +1 55 11 3087 1015
__________
This announcement is not for distribution, directly or indirectly, in or into the United States (including its territories and dependencies, any State of the United States and the District of Columbia), Canada, Australia or Japan. This announcement does not constitute or form a part of any offer or solicitation to purchase or subscribe for securities in the United States. The securities mentioned herein have not been, and will not be, registered under the United States Securities Act of 1933 (the "Securities Act").
Securities may not be offered or sold in the United States except pursuant to an exemption from the registration requirements of the Securities Act.
This document is an advertisement and does not constitute a prospectus or offering memorandum or an offer in respect of any securities and is not intended to provide the basis for any decision in respect of The Forest Company Limited or other evaluation of any securities of The Forest Company Limited or any other entity and should not be considered as a recommendation that any investor should subscribe for or purchase any such securities. Neither the issue of this document nor any part of its contents constitutes an offer to sell or invitation to purchase any securities of The Forest Company Limited or any other entity or any persons holding securities of The Forest Company Limited.