The investment objective is to achieve absolute total returns over the medium to longer term, principally through capital gains and supplemented with the generation of a longer term income yield. The company targets a return on equity, after running costs, of between 12% and 15% p.a. over the long term.
Annual management fee of i 1.50% p.a. of the average audited NAV of LMS if NAV is GBP 100m or less ii 1.25% p.a. if NAV exceeds GBP 100m, but is less than GBP 150m and iii 1.00% p.a. if the NAV exceeds GBP150m. Performance fee of 15% of the gain in the NAV of New Investments is payable if its cumulative compound growth represents at least 8% p.a. Contract terminable on notice period of 12 months.
The company will institute a progressive annual dividend policy. The Board is initially targeting a dividend in respect of each financial year of approximately 1.5% of that year's closing NAV. The amount of dividend will be reviewed each year in light of the Company's liquidity, the investment income generated, distributable profits and market conditions.