REG - Life Settlement - Statement re agreement to reduce performance fee

Life Settlement AssetsAnnouncement

30/06/2022 07:16

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RNS Number : 7164Q  Life Settlement Assets PLC  30 June 2022

 

LIFE SETTLEMENT ASSETS PLC (the "Company" or "LSA")

AGREEMENT OF REDUCED ACL PERFORMANCE FEE

30 June 2022

As referred to in the Company's annual results for the year ended 31 December
2021, LSA has been in discussions with Acheron Capital Limited ("ACL")
regarding the re-negotiation of the performance fee payable to ACL, which is
currently defined as an amount equal to 20% of the total distributions made by
the Company over an agreed hurdle rate. Agreement has now been reached with
ACL that once the current litigation process with one of the policy trustees
has been resolved, which is expected to occur during 2022, the performance fee
will be reduced from 20% as described above to 10% over the existing hurdle
rate.

The resolution of the legal dispute is expected to be accompanied by a
judicially approved sale of the policies in the relevant trustee portfolio.
The completion of such a sale process, including LSA`s participation therein
whether successful or not, would mark the end of LSA`s need to accumulate cash
to purchase the relevant policies, so enabling LSA to resume further
distributions to Shareholders.  Assuming resolution of the dispute, following
the first such distribution LSA has agreed to make a one-off payment to ACL of
any accrued performance fee payable to ACL held by the Company in excess of
$1m, based on the 2022 financial results and subject to the cash requirements
of the business.  As at 31 December 2021 the accrued performance fee stood at
$2.8m.  However, in acknowledgement of the significant work that ACL has had
to perform with regard to engagement with the legal dispute over a long
period, the Directors of LSA have agreed to make an immediate advance to ACL,
subject to an agreed clawback mechanism, of $0.5m which will be credited
against any amount to be paid under the above one-off payment arrangement,
following the publication of the 2022 financial results.

 

For further information contact

Acheron Capital Limited (Investment Manager)

Jean-Michel Paul

020 7258 5990

 

Shore Capital (Financial Adviser and Broker)

Robert Finlay

020 7408 4090

 

ISCA Administration Services Limited

Company Secretary

Tel: 01392 487056

 

Notes to Editors

Life Settlement Assets PLC is a closed-ended investment trust company which
invests in, and manages, portfolios of whole and fractional interests in life
settlement policies issued by life insurance companies operating predominantly
in the United States. The Company seeks to generate long-term returns for
investors by investing in the life settlement market, through each of the
separate Share Classes. The Company aims to manage its investment in
portfolios of life settlement products so that the realised value of the
policy maturities exceeds the aggregate cost of acquiring the policies,
ongoing premiums, management fees and other operational costs.

 

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