and Admission to the premium listing segment of the Official List and trading on the London Stock Exchange s main market for listed securities

Transcription

1 THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION. If you are in any doubt as to the action you shoud take, you shoud consut your stockbroker, bank manager, soicitor, accountant or other independent financia adviser authorised under the Financia Services and Markets Act 2000 (as amended) immediatey. This document comprises a prospectus reating to Fundamentum Supported Housing REIT PLC (the Company) prepared in accordance with the Prospectus Rues made pursuant to section 73A of FSMA and approved by the FCA in accordance with section 85 of the FSMA. This Prospectus has been fied with the FCA in accordance with Rue 3.2 of the Prospectus Rues and wi be made avaiabe to the pubic in accordance with the Prospectus Rues at The Directors of the Company, whose names appear on page 40 of this document, and the Company each accept responsibiity for the information contained in this document. Having taken a reasonabe care to ensure that such is the case, the information contained in this document is, to the best of the knowedge of the Directors and the Company, in accordance with the facts and does not omit anything ikey to affect the import of such information. Prospective investors shoud read this document in its entirety and, in particuar, the section headed Risk Factors when considering an investment in the Company. LR (2)(a) Annex I: 1.1, 1.2 Annex III: 1.1, 1.2 Annex XV: (Annex I) 1.1, 1.2 LR (1) Fundamentum Supported Housing REIT PLC (a company incorporated and registered in Engand and Waes with registered number and registered as an investment company under section 833 of the Companies Act 2006) Issue of up to 150 miion Ordinary Shares pursuant to a Pacing, Offer for Subscription and Intermediaries Offer at an Issue Price of 100 pence per Ordinary Share and Annex I: 5.1.1, 5.1.2, Annex XV: 4.1 Annex XV: (Annex I) 5.1.1, 5.1.2, Annex III: 4.1, 5.1.2, Admission to the premium isting segment of the Officia List and trading on the London Stock Exchange s main market for isted securities Sponsor, Financia Adviser and Soe Bookrunner Investec Bank pc AIFM Investment Adviser Intermediaries Offer Adviser Langham Ha Fund Fundamentum Property Scott Harris Management LLP Advisers Limited UK Limited Appications wi be made to the UK Listing Authority and the London Stock Exchange for the Ordinary Shares to be issued in connection with the Issue to be admitted to isting on the premium isting segment of the Officia List and to trading on the premium segment of the main market for isted securities of the London Stock Exchange. It is expected that Admission wi become effective and that deaings for norma settement Annex III: 4.7 in the Ordinary Shares wi commence at 8.00 a.m. on 2 May The Ordinary Shares wi not be deat in on any other recognised investment exchange and no other such appications have been made or are currenty expected. The Issue is not being made, directy or indirecty, in or into, or by the use of the mais, or by any means or instrumentaity (incuding, without imitation, facsimie transmission, teex and teephone) of interstate or foreign commerce, or of any faciity of a nationa securities exchange, of the United States, Canada, Austraia, Japan or any other Restricted Jurisdiction. Accordingy, copies of this document are not being, and must not be, directy or indirecty, maied or otherwise forwarded, distributed or sent in, into or from the United States, Canada, Austraia, Japan or any other Restricted Jurisdiction or to, or for the account or benefit of, any resident of the United States, Canada, Austraia or Japan or any other Restricted Jurisdiction and persons receiving this document (incuding custodians, nominees and trustees) must not mai or otherwise distribute or send it in, into or from such jurisdictions. The Ordinary Shares have not been and wi not be registered under the US Securities Act or under any of the reevant securities aws of any state of the United States or of Canada, Austraia or Japan. Accordingy, uness an exemption under such act or aws is appicabe, the Ordinary Shares may not be offered, sod or deivered directy or indirecty in or into the United States, Canada, Austraia or Japan. In addition, the Company has not been, and wi not be, registered under the United States Investment Company Act of 1940, as amended (the U.S. Investment Company Act), and investors wi not be entited to the benefits of the U.S. Investment Company Act. This document does not constitute, and may not be used for the purposes of, an offer or soicitation to anyone in any jurisdiction in which such offer or soicitation is not authorised or to any person to whom it is unawfu to make such offer or soicitation. Prospective investors shoud consider carefuy (to the extent reevant to them) the notices to residents of various countries set out on pages 34 to 38 of this document. Investec Bank pc, which is authorised in the United Kingdom by the Prudentia Reguation Authority and reguated by the Financia Conduct Authority and the Prudentia Reguation Authority is acting excusivey for the Company and for no-one ese in reation to Admission, the Issue or the matters referred to in this document. Apart from the responsibiities and iabiities, if any, which may be imposed on Investec by the FSMA or the reguatory regime estabished thereunder, Investec does not make any representation, express or impied in reation to, nor accepts any responsibiity whatsoever for, the contents of this document or any other statement made or purported to be made by it or on its behaf in connection with the Company, the Ordinary Shares or the Issue. Investec accordingy, to the fuest extent permissibe by aw, discaims a and any responsibiity or iabiity whether arising in tort, contract or otherwise which it might have in respect of this document or any other statement. Investec wi not regard any other person (whether or not a recipient of this document) as its cient in reation to any Admission or the Issue and wi not be responsibe to anyone other than the Company for providing the protections afforded to cients of Investec nor for advising any other person in reation to any Admission or the Issue or any transaction or arrangement contempated in or by this document. No person has been authorised by the Company to issue any advertisement or to give any information or to make any representations in connection with any Admission or the Issue other than those contained in this document and, if issued, given or made, such advertisement, information or representation must not be reied upon as having been authorised by the Company. Potentia investors shoud consut their stockbroker, bank manager, soicitor, accountant or other independent financia adviser before investing in the Company. Potentia investors shoud aso consider the Risk Factors reating to the Company set out on pages 17 to 30 of this document. 10 Apri 2018

2 TABLE OF CONTENTS Page SUMMARY RISK FACTORS IMPORTANT INFORMATION EXPECTED ISSUE TIMETABLE ISSUE STATISTICS DEALING CODES DIRECTORS, AIFM, INVESTMENT ADVISER AND OTHER ADVISERS DEFINITIONS PART 1 THE COMPANY PART 2 THE UK SOCIAL HOUSING SECTOR PART 3 DIRECTORS, MANAGEMENT AND ADMINISTRATION OF THE COMPANY PART 4 THE ISSUE PART 5 TAXATION PART 6 REIT REGIME PART 7 ADDITIONAL INFORMATION ON THE COMPANY PART 8 TERMS AND CONDITIONS OF APPLICATION UNDER THE PLACING PART 9 TERMS AND CONDITIONS OF APPLICATION UNDER THE OFFER FOR SUBSCRIPTION APPENDIX 1 APPLICATION FORM FOR THE OFFER FOR SUBSCRIPTION APPENDIX 2 TAX RESIDENCY SELF-CERTIFICATION FORM (INDIVIDUALS)

3 SUMMARY Summaries are made up of discosure requirements known as Eements. These eements are numbered in Sections A-E (A.1 E.7). This summary contains a the Eements required to be incuded in a summary for this type of securities and issuer. Because some Eements are not required to be addressed there may be gaps in the numbering sequence of the Eements. Even though an Eement may be required to be inserted into the summary because of the type of securities and issuer, it is possibe that no reevant information can be given regarding the Eement. In this case a short description of the Eement is incuded in the summary with the mention of not appicabe. Section A Introduction and warnings Eement Discosure Requirement Discosure A.1. Warning This summary shoud be read as an introduction to this document. Any decision to invest in the Ordinary Shares shoud be based on consideration of this document as a whoe by the investor. Where a caim reating to the information contained in this document is brought before a court, the paintiff investor might, under the nationa egisation of the EEA States, have to bear the costs of transating this document before the ega proceedings are initiated. Civi iabiity attaches ony to those persons who are responsibe for this summary, incuding any transation thereof, but ony if the summary is miseading, inaccurate or inconsistent when read together with the other parts of this document or it does not provide, when read together with other parts of this document key information in order to aid investors when considering whether to invest in such securities. A.2. Subsequent resae or fina pacement of securities through financia intermediaries The Company consents to the use of this document by financia intermediaries in connection with the subsequent resae or fina pacement of securities by financia intermediaries in connection with the Issue ony. The offer period within which any subsequent resae or fina pacement of securities by Intermediaries can be made and for which consent to use this document is given commences on 10 Apri 2018 and coses on 27 Apri 2018, uness cosed prior to that date. Any financia intermediary that uses this document must state on its website that it uses this document in accordance with the Company s consent. Intermediaries are required to provide the terms and conditions of the Intermediaries Offer to any prospective investor who has expressed an interest in participating in the Intermediaries Offer to such Intermediary. Information on the terms and conditions of any subsequent resae or fina pacement of securities by any financia intermediary is to be provided at the time of the offer by the financia intermediary. Eement Discosure Requirement Discosure Section B Issuer B.1. Lega and commercia name Fundamentum Supported Housing REIT PLC (the Company). 3

4 B.2. Domicie and ega form The Company was incorporated in Engand and Waes under the Act as a pubic company imited by shares on 8 February 2018 with registration number and is a cosed-ended investment company, registered under s.833 of the Companies Act B.5. Group description The Company is not part of a group as at the date of this Prospectus. Foowing Admission, the Company wi acquire and hod investment properties through SPVs. B.6. Major sharehoders As at the date of this document, other than as discosed, insofar as known to the Company, there are no persons known to have a notifiabe interest under Engish aw in the Company s capita or voting rights. A Sharehoders have the same voting rights in respect of the share capita of the Company. Pending the aotment of Ordinary Shares pursuant to the Issue, the Company is controed by FPL. Other than as discosed, the Company and the Directors are not aware of any person who, directy or indirecty, jointy or severay, exercises or coud exercise contro over the Company. B.7. B.8. Key financia information Key pro forma financia information Not appicabe. The Company has not commenced operations since its incorporation on 8 February 2018 and no financia statements of the Company have been made as at the date of this document. Not appicabe. No pro forma financia information is incuded in this document. B.9. Profit forecast Not appicabe. No profit forecast or estimate is made in this document. B.10. B.11. Description of the nature of any quaifications in the audit report on the historica financia information Working capita insufficiency Not appicabe. The Company has been newy incorporated and has no historica financia information. Not appicabe. The Company is of the opinion, taking into account the Minimum Net Proceeds, that the working capita avaiabe to the Company is sufficient for its present requirements, that is, for at east the next 12 months from the date of this document. B.34. Investment poicy Investment objective The Company wi seek to provide investors with an attractive eve of income together with the prospect of income and capita growth through investment in a portfoio of assets in the Socia Housing sector across the United Kingdom with a particuar focus on Supported Housing assets to be et on ong-term infation inked ease agreements with Registered Providers. 4

5 Investment poicy Asset aocation The Company wi pursue its investment objective by investing in a diversified portfoio of freehod or ong easehod Socia Housing in the United Kingdom. Supported Housing assets to be acquired and/or hed wi account for at east 80 per cent. of Gross Asset Vaue (once fuy invested) with Genera Needs Housing assets accounting for a maximum of 20 per cent. of Gross Asset Vaue (once fuy invested). The Company wi acquire portfoios of Socia Housing and singe Socia Housing either directy or via SPVs. Each asset wi be subject to a Lease with a Registered Provider for terms primariy ranging from 15 years to 35 years, with the rent payabe thereunder subject to adjustment in ine with infation (generay CPI or aternativey RPI). An agreement to ease wi be agreed with the Registered Provider in advance of investment in the asset. Tite to the assets wi remain with the reevant member of the Group under the terms of the Lease. No member of the Group wi have a direct contractua reationship with the occupant of the reevant Socia Housing asset. The Group wi not be responsibe for any management or maintenance obigations under the terms of the Lease, a of which wi be serviced by the Registered Provider. The Group wi not be responsibe for the provision of care to occupants of Supported Housing assets. The Company wi aso invest in Socia Housing which requires upgrading and wi engage in renovating or customising existing homes as necessary. The Company may aso forward finance Supported Housing properties where there is an agreement to ease in pace and where such assets provide a better opportunity, cost effectiveness and/or improved standard of iving for the occupants of the Socia Housing. The Company wi not forward finance Genera Needs Housing units. The Company intends to invest the Net Issue Proceeds within 12 months of Admission. The Company intends to hod the Portfoio over the ong-term, taking advantage of ong term upward ony infation-inked Leases. The Company wi not be activey seeking to dispose of any of its assets, athough it may dispose of investments shoud an opportunity arise that woud enhance the vaue of the Company as a whoe. Investment restrictions The Company wi invest and manage the Portfoio with the objective of deivering a diversified Portfoio through the foowing investment restrictions: the Company wi ony invest in Socia Housing associated with the Supported Housing sector and Genera Needs Housing sector ocated in the United Kingdom; the Company wi ony invest in Supported Housing and Genera Needs Housing where the counterparty to the Lease is a Housing Association or Loca Authority; the Company wi ony invest where there is an agreement to ease with the Housing Association or Loca Authority in pace prior to investment; no Lease sha be for an unexpired period of ess than 15 years; 5

6 at east 80 per cent. of the Gross Asset Vaue wi be invested in the Supported Housing sector (once fuy invested); the maximum exposure to the Genera Needs Housing sector wi not exceed 20 per cent. of the Gross Asset Vaue (once fuy invested); the maximum exposure to any one asset (which, for the avoidance of doubt, wi incude houses and/or apartment bocks ocated on an adjoining basis but which are eased to the same Registered Provider), wi not exceed 20 per cent. of the Gross Asset Vaue; the maximum exposure to any one Registered Provider wi not exceed 25 per cent. of the Gross Asset Vaue; the Company may forward finance Supported Housing properties in circumstances where there is an agreement to ease in pace and where the Company receives a coupon on its investment (generay equivaent to the projected income return for the competed asset) during the construction phase and prior to the entry into the Lease. The sum of the tota forward financing commitments wi be restricted to an aggregate vaue of not more than 10 per cent. of the Gross Asset Vaue, cacuated at the time of entering into any new forward funding arrangement; the Company wi not forward finance Genera Needs Housing units; the Company wi not acquire and for specuative deveopment of Socia Housing; the Company wi not invest in other aternative investment funds or cosed-ended investment companies (which, for the avoidance of doubt, does not prohibit the acquisition of SPVs which own individua, or portfoios of, Socia Housing); and the Company wi not set itsef up as a Registered Provider. These investment restrictions appy at the time of the acquisition of the reevant investment in the Portfoio. The Company wi not be required to dispose of any investment or to rebaance its Portfoio as a resut of a change in the respective vauations of its assets. In the event of any materia breach of the Company s investment poicy or of the investment restrictions appicabe to the Company, Sharehoders wi be informed of the actions to be taken by the Company and/or the AIFM (at the time of such breach) through an announcement via a Reguatory Information Service. Cash management Unti the Company is fuy invested, and pending re-investment or distribution of cash receipts, the Company may invest in cash, cash equivaents, near cash instruments and money market instruments. 6

7 REIT status The Company wi at a times conduct its affairs so as to enabe it to remain quaified (once quaified) as a REIT for the purposes of Part 12 of the Corporation Tax Act 2010 (and the reguations made thereunder). B.35. Borrowing imits Gearing Limit The Company wi seek to use gearing to enhance equity returns. The eve of borrowing wi be on a prudent basis for the asset cass, whist maintaining fexibiity in the underying security requirements and the structure of both the Portfoio and the Group. The Company may raise debt from banks, a Socia Housing Reguator and/or the capita markets and the aggregate borrowings of the Group wi aways be subject to an absoute maximum, cacuated at the time of drawdown of the reevant borrowings, of not more than 40 per cent. of the Gross Asset Vaue (athough the Investment Adviser expects actua gearing to be around 30 per cent.). Debt wi typicay be secured at asset eve, whether over particuar property or hoding entities for any property without recourse to the Company and aso potentiay at Company or SPV eve with or without a charge over the Portfoio (but not against particuar assets) depending on the optima structure for the Group and having consideration to key metrics incuding ender diversity, cost of debt, debt type and maturity profies. Otherwise there wi be no cross-financing between investments in the Portfoio and the Company wi not operate a common treasury function between the Company and its investments. Use of derivatives The Company may utiise derivatives for efficient portfoio management. In particuar, the Company may engage in fu or partia interest rate hedging or otherwise seek to mitigate the risk of interest rate increases on borrowings incurred in accordance with the gearing imits as part of the management of the Portfoio. B.36. Reguatory status The Company is not authorised or reguated as a coective investment scheme by the FCA but wi, foowing Admission, be subject to the Listing Rues, the Discosure Guidance and Transparency Rues and the Prospectus Rues as appicabe to cosed-ended investment companies. It wi aso be subject to the EU s Market Abuse Reguation and the rues of the London Stock Exchange. It wi aso be an EU aternative investment fund for the purposes of the AIFMD. As a REIT, the Ordinary Shares wi be excuded securities under the FCA s rues on non-mainstream pooed investments. Accordingy, the promotion of the Ordinary Shares wi not be subject to the FCA s restriction on the promotion of non-mainstream pooed investments. The Ordinary Shares shoud be considered as non-compex in accordance with MiFID II. B.37. Typica investor An investment in Ordinary Shares is suitabe for institutiona investors, professiona investors and retai investors. 7

8 B.38. B.39. B.40. Investment of 20 per cent. or more in singe underying asset or investment company. Investment of 40 per cent. or more in singe underying asset or investment company. Appicant s service providers Not appicabe. The Company does not at the date of this document and wi not at Admission have any such investments. Not appicabe. The Company does not at the date of this document and wi not at Admission have any such investments. AIFM Langham Ha Fund Management LLP has been appointed as aternative investment fund manager pursuant to the AIFM Agreement under which it is responsibe for overa portfoio management, risk management and ensuring compiance with the requirements of the AIFMD that appy to the Company. The Company and the AIFM have appointed the Investment Adviser to source properties and provide investment advisory and property management services pursuant to the Investment Advisory Agreement. The AIFM has, and sha maintain, the necessary expertise and resource to supervise the Investment Adviser effectivey. Pursuant to the AIFM Agreement, the AIFM wi receive a recurring annua fee of 70,000, subject to any additiona fees depending on increased activities of the Company or increased assets under management over 100 miion. A such fees and expenses are excusive of VAT. No performance fee is payabe to the AIFM. Investment Adviser Fundamentum Property Advisers Limited, a whoy owned subsidiary of Fundamentum Property Limited has been appointed by the Company and the AIFM as Investment Adviser pursuant to the Investment Advisory Agreement. The Investment Adviser wi source properties and provide investment advisory and property management services in accordance with the Company s investment objective and investment poicy. The Investment Advisory Agreement provides that the Company wi pay to the Investment Adviser a fee (payabe monthy in arrears) cacuated at the rate of: (a) 1 per cent. per annum of the Net Asset Vaue up to, and incuding, 250 miion; (b) 0.90 per cent. per annum of the Net Asset Vaue in excess of 250 miion and up to and incuding 500 miion; (c) 0.80 per cent. per annum of the Net Asset Vaue in excess of 500 miion and up to, and incuding, 1 biion; and (d) 0.70 per cent. per annum of the Net Asset Vaue in excess of 1 biion. In addition, the Investment Adviser wi receive a fee for property renta coection services of 2.5 per cent. of the gross rent coected periodicay pursuant to the Lease. This fee wi be reviewed by the Board after a period of 12 months and thereafter wi be subject to an annua review by the Board. Depositary Langham Ha UK Depositary LLP has been appointed as the Company s depositary for the purposes of the AIFMD. Under the terms of the Depositary Agreement, the Depositary is entited to be paid an initia one off fee of 5,000 which may be 8

9 invoiced from the date of its appointment and an annua fee of 40,000 subject to any additiona fee depending on increased activities of the Company. The Depositary is authorised and reguated by the FCA (FCA registration number ). Sponsor, Financia Adviser and Bookrunner Investec has agreed to act as Sponsor, Financia Adviser and Bookrunner to the Company in reation to the Issue and Admission. Investec has agreed to use its reasonabe endeavours to procure subscribers under the Pacing. Conditiona upon competion of the Issue, Investec wi be paid a corporate finance fee and a commission cacuated as: (i) a percentage of the gross proceeds of the Pacing and the Offer; and (ii) a percentage of the gross proceeds of the Intermediaries Offer ess any commission paid to the Intermediaries Adviser and to the Intermediaries in connection with the Intermediaries Offer by the Company in consideration for their services in reation to the Issue. Administrator and Company Secretary Langham Ha UK Services LLP has been appointed as Administrator to the Company and wi aso provide administrative and company secretaria services and a registered office to the Company. The Administrator provides the day-to-day administration of the Company and is aso responsibe for the Company s genera administrative functions, such as cacuation and pubication of the Net Asset Vaue and maintenance of the Company s accounting and statutory records. The annua recurring fee payabe under the Administration and Company Secretaria Agreement is 140,000 per annum subject to additiona fees depending on the increased activities of the Company. Registrar services The Company wi utiise the services of Link Asset Services as registrar in reation to the transfer and settement of Ordinary Shares hed in uncertificated form. Given that the fees payabe under the Registrar Agreement are cacuated as a mutipe of the number of Sharehoders admitted to the register each year pus a mutipe of the number of share transfers made each year, there is no maximum amount payabe under the Registrar Agreement. The Registrar is aso entited to reimbursement of a out of pocket costs, expenses and charges propery incurred on behaf of the Company. Receiving Agent services Link Market Services Limited has agreed to act as receiving agent in respect of the Offer for Subscription. Under the terms of the Receiving Agent Agreement, the Receiving Agent is entited to a fixed fee and reimbursement of a out-of-pocket expenses reasonaby incurred by it in connection with its duties. Reporting Accountants and Auditors KPMG Audit LLC wi provide audit services to the Company. The annua report and accounts wi be prepared according to accounting standards in accordance with IFRS. The fees charged by the Auditor depend on the services provided, computed, inter aia, on the time spent by the Auditor on the affairs of the Company; there is therefore no maximum amount payabe under the Auditor s engagement etter. 9

10 B.41. B.42. Reguatory status of AIFM, Investment Adviser and Depositary Cacuation of Net Asset Vaue Distribution Agent LGBR Capita London Limited wi act as distribution agent in connection with the Pacing and Offer and subsequent fundraising. LGBR Capita London Limited wi be paid a fee cacuated as a percentage of the gross proceeds of the Pacing and the Offer. Intermediaries Offer Adviser Scott Harris UK Limited has been appointed as Intermediaries Offer Adviser. Conditiona upon competion of the Issue, Scott Harris UK Limited wi be paid a fixed management fee in addition to a commission cacuated as a percentage of the gross proceeds of the Intermediaries Offer. Vauers The Company intends to appoint Asop LLP to prepare vauation reports on the Portfoio. The AIFM is authorised and reguated by the FCA The Investment Adviser is permitted to conduct reguated activities as an appointed representative of the AIFM. The Depositary is authorised and reguated by the FCA. The AIFM wi manage the vauation process. The vauation of the Portfoio wi be cacuated by an independent professiona vauer in accordance with the Market Vaue Subject To Tenancies ( MV-T ) methodoogy on a haf-yeary basis. The Net Asset Vaue and EPRA Net Asset Vaue together with the Net Asset Vaue per Share and EPRA NAV per Share wi be cacuated on a haf-yeary basis by the Administrator in consutation with the Investment Adviser and any reevant professiona advisers, with approva from the AIFM and wi be presented to the Board for their approva and adoption. The Net Asset Vaue and EPRA Net Asset Vaue wi be cacuated on the basis of the reevant haf yeary vauation of the Portfoio. Cacuations are made in accordance with IFRS and, uness the Board determines otherwise, in accordance with EPRA s best practice recommendations. Detais of each of the haf-yeary vauations wi be announced by the Company through a Reguatory Information Service and wi be avaiabe on the Company s website as soon as practicabe after their adoption. In addition, the cacuations wi be reported to Sharehoders in the Company s annua report and haf-yeary financia statements. The Company wi report its EPRA NAV according to EPRA guideines. B.43. Cross iabiity Not appicabe. The Company is not an umbrea coective investment undertaking and as such there is no cross iabiity between casses or investment in another coective investment undertaking. B.44. No financia statements have been made up The Company has not commenced operations since its incorporation on 8 February 2018 and no financia statements of the Company have been made as at the date of this document. B.45 Portfoio Not appicabe. The Company has not commenced operations and has no portfoio at the date of this document. B.46. Net Asset Vaue Not appicabe. The Company has not commenced operations and so has no Net Asset Vaue as at the date of this document. 10

11 Eement Discosure Requirement Discosure Section C Securities C.1. Type and cass of securities The Company intends to issue Ordinary Shares of nomina vaue 1 pence each pursuant to the Issue. The ISIN of the Ordinary Shares is GB00BZ1CQC31. The SEDOL of the Ordinary Shares is BZ1CQC3. The ticker for the Ordinary Shares is FSHR. C.2. Currency The Company wi issue Ordinary Shares denominated in stering. C.3. C.4. Number of securities in issue Description of the rights attaching to the securities The Company intends to issue up to 150 miion Ordinary Shares offered at an Issue Price of 100 pence per Ordinary Share. The issued share capita of the Company as at the date of this document is: Nomina Vaue ( ) Number Redeemabe Preference Shares 50,000 50,000 Ordinary Shares The Redeemabe Preference Shares are paid up as to their nomina vaue and wi be redeemed immediatey foowing Admission out of the proceeds of the Issue. The Ordinary Shares are fuy paid up and are not redeemabe. Voting Rights Subject to any specia rights, restrictions or prohibitions as regards voting for the time being attached to any Ordinary Shares, Sharehoders sha have the right to receive notice of and to attend and vote at genera meetings of the Company. Each Sharehoder being present in person or by proxy or by a duy authorised representative (if a company) at a genera meeting sha upon a show of hands have one vote and upon a po sha have one vote for every Ordinary Share hed. The Redeemabe Preference Shares sha not carry any right to receive notice of or attend or vote at any genera meetings of the Company uness no other shares are in issue at that time. Dividend rights The Sharehoders wi be entited to receive such dividends as the Directors may resove to pay to them out of the assets attributabe to their Ordinary Shares. A hoder of Redeemabe Preference Shares sha be entited (in priority to any payment of dividend on any other cass of share) to a fixed cumuative preferentia dividend of 0.01 per cent. per annum on the nomina amount of the Redeemabe Preference Shares hed, such dividend to accrue annuay and to be payabe in respect of each accounting reference period of the Company within 21 days of the end of such period. Return of capita On a winding up or a return of capita by the Company, the capita and assets of the company sha be appied first amongst the hoders of Redeemabe Preference Shares pro rata according to the nomina capita paid up on their hodings of Redeemabe Preference Shares, and second the Ordinary Share Surpus sha be divided amongst the Sharehoders pro rata according to the nomina capita paid up on their hodings of Ordinary Shares. 11

12 C.5. Restrictions on the free transferabiity of the securities Subject to the Artices and to compiance with appicabe reguations, a Sharehoder may freey transfer a or any of his Ordinary Shares in any matter which is permitted by the Act or in any other awfu manner approved by the Board from time to time. C.6. Admission Appications wi be made to the UK Listing Authority for a of the Ordinary Shares to be issued pursuant to the Issue to be admitted to the premium segment of the Officia List and to the London Stock Exchange for such Ordinary Shares to be admitted to trading on the main market for isted securities. It is expected that Admission wi become effective and deaings wi commence on 2 May C.7. Dividend poicy There are no assurances that the Company wi pay any dividends. Subject to market conditions and the Company s eve of net income, it is the Directors intention to pay dividends to Sharehoders on a quartery basis, as three equay weighted interim dividends and a fina dividend in accordance with the REIT Regime. Upon fu investment of Net Issue Proceeds and associated gearing, the Company is targeting a dividend yied of 5.0 per cent. or more per annum based on the Issue Price, which the Company expects to increase broady in ine with infation. Foowing Admission, the Company is targeting a dividend of 2 per cent. or more based on the Issue Price for the 12 months foowing Admission and the Directors expect to decare the first dividend in reation to the period ending 31 December in March The dividend and return targets stated above are targets ony and not a profit forecast. Eement Discosure Requirement Discosure As a REIT, the Company is required to meet a minimum distribution test for each accounting period that it is a REIT. This minimum distribution test requires the Company to distribute 100 per cent. of the income profits of the Company which are derived from distributions of profits or gains of the Quaifying Property Renta Business of another UK REIT and a minimum of 90 per cent. of the income profits of the Company s Quaifying Property Renta Business derived from other sources as Property Income Distributions. In the medium to ong term it is expected that a significant proportion of dividends wi be paid in the form of Property Income Distributions. The actua spit of dividends decared wi vary between Property Income Distributions and non-property Income Distributions over time. Section D Risks D.1 Key information on the key risks that are specific to the Company or its industry Investments made by the Company wi comprise interests in the ega tite to Socia Housing and residentia property assets that are not pubicy traded or freey marketabe and these investments are often subject to restrictions on who may own and/or operate the property assets concerned and may, therefore, be difficut to reaise at the vaue attributed to such investments, or at a. The Net Asset Vaue shoud not be assumed to represent the vaue at which the Portfoio coud be sod in the market or that the assets of the Company are saeabe readiy or otherwise. 12

13 The growth of the Company depends on the abiity of the Company to identify, seect, acquire and manage investments that offer the potentia for satisfactory returns, incuding the abiity to enter into suitabe ease and/or management arrangements with Registered Providers. In addition, the AIFM, may or may not accept identified opportunities as being suitabe for investment by the Company and there can be no guarantee that the Company wi proceed to compete the acquisition of any such investment opportunities. The Company is dependent upon the good governance and financia viabiity of the Registered Providers. Returns from the Company s investments wi be affected by the price at which they are acquired. The vaue of these investments wi be (amongst other risk factors) a function of the discounted vaue of their expected future cash fows, and as such wi vary with, inter aia, infation and the competition for such assets. Property vauation is inherenty subjective and uncertain. The vaue of such assets is determined by an appraisa process that can significanty differ from the transaction price, even though the basis of the appraisa process is to determine the fair vaue of the anaysed assets. There is a risk of changes to the Socia Housing reguatory regime, and the eves of rent payabe under it, and/or to the housing benefit regime, any of which may adversey affect the Company and its return to Sharehoders. Where a property requires refurbishment or renovation, the Company is dependent on the performance of third party contractors and sub-contractors who may fai to perform their contractua obigations, which may have a materia adverse effect on the Company s performance, financia condition and business prospects. The Company wi compete against other investors to acquire investments avaiabe in the Socia Housing sector, which may not be favourabe to the Company at a times. Goba market uncertainty and the weakened economic conditions in the United Kingdom and esewhere may reduce the vaue of the Company s portfoio once it has been acquired, and may reduce iquidity in the rea estate market. The Company has no operating history. If the Company fais to quaify, or remain quaified, as a REIT, its renta income and gains wi be subject to UK corporation tax. The Company s status as a REIT may restrict business consoidation opportunities and distribution opportunities to Sharehoders. Changes in interest rates may adversey affect the Company s investments. Any change in the tax status of the Company or any of its underying investments or in tax egisation or practice (incuding in reation to taxation rates and aowances) or in accounting standards coud adversey affect the investment return of the Company. 13

14 D.3. Key information on the key risks specific to the securities Risks reating to the Ordinary Shares The market vaue of, and the income derived from, the Ordinary Shares can fuctuate. The market vaue of the Ordinary Shares, as we as being affected by their Net Asset Vaue and prospective Net Asset Vaue, aso takes into account their dividend yied and prevaiing interest rates. The Ordinary Shares may trade at a discount to Net Asset Vaue and Sharehoders may be unabe to reaise their investments through the secondary market at Net Asset Vaue. There is no guarantee that a iquid market wi be estabished in the Ordinary Shares. There is no guarantee that any dividend in respect of any period wi be paid. There is no guarantee that the Company wi achieve the stated target net tota Sharehoder return referred to in this document and therefore achieve its return objective. The Company s abiity to pay dividends wi be dependent principay upon the investments comprising of the Portfoio. No guarantee of return. A prospective investor shoud be aware that the vaue of an investment in the Company is subject to norma market fuctuations and other risks inherent in investing in equity securities. There is no assurance that any appreciation in the vaue of the Ordinary Shares wi occur or that the investment objectives of the Company wi be achieved. Section E Offer Eement Discosure Requirement Discosure E.1. E.2A. Net proceeds and costs of the Issue Reason for offer and use of proceeds The Company is targeting an issue of up to 150 miion Ordinary Shares pursuant to the Issue at the Issue Price of 100 pence per Ordinary Share. The actua number of Ordinary Shares to be issued pursuant to the Issue, and therefore the Gross Issue Proceeds, are not known as at the date of this document but wi be notified by the Company via a Reguatory Information Service announcement prior to Admission. The aggregate proceeds of the Issue, after deduction of expenses, are expected to be 147 miion on the assumption that the Gross Issue Proceeds are 150 miion. The costs of Admission and Issue which wi be borne by the Company are capped at 2 per cent. of the Gross Issue Proceeds. The Issue is being made in order to raise funds for the purpose of investment in accordance with the investment objective and investment poicy of the Company. The Company wi use the Net Issue Proceeds in accordance with the Company s investment objective and investment poicy. The Investment Adviser on behaf of the Company intends to depoy the Net Issue Proceeds within 12 months of Admission. 14

15 E.3. Terms and conditions of the offer Ordinary Shares are being made avaiabe under the Issue at the Issue Price. The Issue comprises the Pacing, the Offer for Subscription and the Intermediaries Offer. Investec has agreed to use their reasonabe endeavours to procure subscribers pursuant to the Pacing for the Ordinary Shares. The Pacing wi cose at 1.00 p.m. on 27 Apri 2018 (or such ater date as the Company and Investec may agree). If the Issue is extended, the revised timetabe wi be notified through a Reguatory Information Service. The Offer for Subscription is being made by the Company in the United Kingdom ony. Appications under the Offer for Subscription must be for a minimum subscription of 1,000 Ordinary Shares and then in mutipes of 1,000 Ordinary Shares thereafter. Competed Appication Forms and the accompanying payment in reation to the Offer for Subscription must be received by the Receiving Agent by no ater than a.m. on 27 Apri Under the Intermediaries Offer, the Ordinary Shares are being offered by the Company to Intermediaries in the United Kingdom who wi faciitate the participation of their retai investor cients ocated in the United Kingdom. A minimum appication of 1,000 Ordinary Shares per Underying Appicant wi appy. Competed Appications from Intermediaries must be received by the Receiving Agent no ater than a.m. on 27 Apri The Issue is conditiona, inter aia, on: the Pacing and Offer Agreement becoming whoy unconditiona in respect of the Issue (save as to Admission) and not having been terminated in accordance with its terms at any time prior to Admission; Admission having become effective on or before 8.00 a.m. on 2 May 2018 or such ater time and/or date as the Company and Investec may agree (being not ater than 8.00 a.m. on 31 May 2018); and the Minimum Net Proceeds being raised. E.4. Materia interests Not appicabe. There are no interests that are materia to the Issue. E.5. Name of person seing securities Not appicabe. No person or entity is offering to se Ordinary Shares as part of the Issue. E.6. Diution Not appicabe. No diution wi resut from the Issue. E.7. Expenses charged to the investor The costs and expenses of the Admission and Issue incude costs of incorporation of the Company, the fees payabe in reation to Admission, incuding isting fees, as we as the fees due under the Pacing and Offer Agreement, the fees payabe to other professiona advisers and other reated expenses. The amount of the costs of the Admission and Issue which wi be borne by the Company is capped at 2 per cent. of the Gross Issue Proceeds and therefore the costs and expenses wi be borne indirecty by investors. 15

16 A expenses incurred by any Intermediary are for its own account. Investors shoud confirm separatey with any Intermediary whether there are any commissions, fees or expenses that wi be appied by such Intermediary in connection with any appication made through that Intermediary pursuant to the Intermediaries Offer. 16

17 RISK FACTORS Annex I: 4 Investment in the Company is subject to a number of risks, incuding but not imited to the risks in reation to the Company and the Ordinary Shares referred to beow and shoud not be regarded as short term in nature. If any of the risks referred to in this document were to occur, the financia position, performance and prospects of the Company coud be materiay and adversey affected. If that were to occur, the trading price of the Ordinary Shares and/or their Net Asset Vaue and/or the eve of dividends or distributions (if any) received from the Ordinary Shares coud decine significanty and investors coud ose a or part of their investment. The risk factors set out beow are those which are considered by the Company and the Directors to be materia as at the date of this document but are not the ony risks reating to the Company or the Ordinary Shares. Additiona risks and uncertainties reating to the Company or the Ordinary Shares that are not currenty known to it or that the Directors or the Company do not currenty consider to be materia may aso have a materia adverse effect on the Company. Potentia investors shoud review this document carefuy and in its entirety and consut their stockbroker, bank manager, soicitor, accountant or other financia adviser before investing in the Company. Investors shoud consider the foowing materia risk factors in reation to the Company and the Ordinary Shares. RISKS ASSOCIATED WITH THE COMPANY S INVESTMENT IN SOCIAL HOUSING Liquidity risks: iquidity of investments Investments made by the Company wi comprise interests in the ega tite to Socia Housing and residentia property assets that are not pubicy traded or freey marketabe and these investments are often subject to restrictions on who may own and/or operate the property assets concerned and may, therefore, be difficut to reaise at the vaue attributed to such investments, or at a. The Net Asset Vaue shoud not be assumed to represent the vaue at which the Portfoio coud be sod in the market or that the assets of the Company are saeabe readiy or otherwise. Liquidity risks: avaiabiity of investments The growth of the Company depends upon the abiity of the Company to identify, seect, acquire and manage investments that offer the potentia for satisfactory returns. The avaiabiity of such investment opportunities wi depend, in part, upon conditions in the Sector and the eve of competition for assets in the market. In addition, the AIFM may or may not accept identified opportunities as being suitabe for investment by the Company and there can be no guarantee that the Company wi proceed to compete the acquisition of any such investment opportunities. In the case that the Company is unabe to acquire sufficient investments that offer the potentia for satisfactory returns, there is a materia risk that the Company may be unabe to achieve its anticipated tota Sharehoder returns. Market risk: Risks reating to the market vaue of Socia Housing and investments returns Returns from the Company s investments wi be affected by the price at which they are acquired. The vaue of these investments wi be (amongst other risk factors) a function of the discounted vaue of their expected future cash fows, and as such wi vary with, inter aia, infation and the competition for such assets. The vaue of the Portfoio and the Company s revenue, cash fow and profits from renting and/or the sae of properties wi be dependent on economic conditions in the United Kingdom. If the Company is required to undertake acceerated saes of its properties with a tenant in pace by way of investment saes, it may not be abe to reaise the fu potentia vaue of its properties. The renta income that the Portfoio produces may fuctuate as a resut of factors which are outside its contro. In addition, there is a risk that in the future Homes Engand or the Scottish Government, the Wesh Government or the Housing Executive in Northern Ireand may more cosey monitor renta income charged by the Registered Providers which may resut in the introduction of a cap on renta income. Whist the Company considers the risk of capping rents to be remote under current United Nation conventions, there is a risk that a banding system which is dependent on the needs of the service users may be introduced. Future acquisitions may expose the Company to unforeseen risks Annex XV (Annex I): 4 17

18 and iabiities associated with properties the Company acquires. The cost of the Company s renovation, maintenance and modernisation programmes may be higher than expected, especiay if the Portfoio contains oder Socia Housing and is dependent on third parties. Any such changes may have an adverse effect on the abiity of the Company to pursue its investment poicy, and may adversey affect the Company s business, financia condition, resuts of operations, abiity to maintain its dividend poicy, Net Asset Vaue and/or the market price of the Ordinary Shares. In such event, the investment returns of the Company may be materiay affected. Vauation risk: risk reating to vauation of Socia Housing Property vauation is inherenty subjective and uncertain. The vaue of such assets is determined by an appraisa process that can significanty differ from the transaction price, even though the basis of the appraisa process is to determine the fair vaue of the anaysed assets. A sizeabe proportion of investments made by the Company may comprise interests in the ega tite to Socia Housing and residentia property assets that are not pubicy traded or freey marketabe and these investments are often subject to restrictions on who may own and/or operate the property assets concerned and may, therefore, be difficut to vaue. Risk of changes to the Socia Housing reguatory regime There is the risk that the current or future governments may take a different approach to the Socia Housing reguatory regime. This may resut in changes to the aw (incuding the Housing and Regeneration Act 2008, Reguatory Standards, Rent Standard Guidance, the Care Act 2014 and the Homeessness Reduction Act 2017) and other reguation or practices of the government with regard to Socia Housing. Reguatory changes may, for exampe, ead to a reduction in Government funding to Loca Authorities which may in turn impact upon the abiity of Registered Providers to pay rent to the Company at the eve agreed in a Lease, or impose increased responsibiities on the owners of Socia Housing assets in the event that the Registered Provider fais to maintain adequate maintenance and safety standards. Any such changes may have an adverse effect on the abiity of the Company to pursue its investment poicy, and may adversey affect the Company s business, financia condition, resuts of operations, abiity to maintain its dividend poicy, NAV and/or the market price of the Shares. In such event, the investment returns of the Company may be materiay affected. Sufficiency of due diigence Whist the Company wi generay undertake an in-depth due diigence exercise in connection with the purchase of future acquisitions of investments, this may not revea a facts and circumstances that may be reevant in connection with an investment and may not prevent an acquisition being materiay overvaued. In doing so, the Company woud rey, in part, on third parties to conduct a significant portion of this due diigence (incuding ega reports on tite and property vauations). To the extent that such third parties underestimate or fai to identify risks and iabiities (incuding any environmenta iabiities) associated with the investment in question, the Company may be subject to defects in tite, or to environmenta, structura or operationa defects requiring remediation, or the Company may be unabe to obtain necessary permits which may have a materia adverse effect on the Company s abiity to perform in accordance with projections, particuary as to rent and occupancy and anticipated tota Sharehoder returns. In addition, such faiures to identify risks and iabiities may have a materia adverse impact on the Net Asset Vaue and the price of the Ordinary Shares. Competition for assets The Company wi compete against other investors (both Registered Providers and private sector investors) to acquire investments avaiabe in the Sector. Competition for appropriate investment opportunities may increase, thus reducing the number of opportunities avaiabe to, and adversey affecting the terms upon which investments can be made by, the Company, and thereby imiting the growth potentia of the Company. Risk reating to negative media attention As the freehod or ong easehod owner of Socia Housing, there may be circumstances in which the remova or eviction of a tenant is warranted or necessary. Such circumstances incude instances of a tenant undertaking iega activities, perpetrating domestic vioence, or permanent renta arrears. Whie these decisions wi be made by the reevant Registered Provider managing the property, there Annex I: