30th Apr 2010 10:26
THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED HEREIN IS NOT FOR PUBLICATION, DISTRIBUTION OR RELEASE IN, OR INTO, THE UNITED STATES, CANADA, AUSTRALIA, JAPAN, IRELAND OR SOUTH AFRICA OR TO US PERSONS. THE INFORMATION CONTAINED HEREIN DOES NOT CONSTITUTE AN OFFER OF SECURITIES FOR SALE INCLUDING IN THE UNITED STATES, CANADA, AUSTRALIA, JAPAN, IRELAND OR SOUTH AFRICA OR TO US PERSONS.
BlackRock Absolute Return Strategies Ltd (the "Company")30 April 2010
Reverse Auction Tender Offer
The Company has today sent the Circular, Form of Proxy and Tender Form in respect of the Reverse Auction Tender Offer to all shareholders. Two copies of the documents have also been submitted to the UK Listing Authority, and will shortly be available for inspection at the Document Viewing Facility, which is situated at:
Financial Services Authority25 The North ColonnadeCanary WharfLondonE14 5HSTel. 020 7066 1000
The full text of the circular is also reproduced below:
THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION. If you are in any doubt as to the action you should take, you are recommended to seek your own financial advice immediately from your stockbroker, bank manager, solicitor, accountant or other independent professional adviser who, if you are taking advice in the United Kingdom, is authorised pursuant to the Financial Services and Markets Act 2000 or, if you are in a territory outside the United Kingdom, from an appropriately authorised independent financial adviser.
If you have sold or otherwise transferred all of your Shares in the Company, please send this document and reply paid envelope but not the accompanying personalised Tender Form or Form(s) of Proxy at once to the bank, stockbroker or other agent through which the sale or transfer was effected, for delivery to the purchaser or transferee. However, such documents should not be forwarded or transmitted in or into any jurisdiction in which such act would constitute a violation of the relevant securities laws in such jurisdiction. If you have sold or transferred only part of your holding of Shares please consult the bank, stockbroker or other agent through which the sale or transfer was effected.
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BLACKROCK ABSOLUTE RETURN STRATEGIES LTD (a registered closed-ended investment company incorporated with limited liability under the laws of Jersey with registered number 100291) Reverse Auction Tender Offer to purchase up to 801,045 Sterling Shares, 164,178 Euro Shares and 165,505 US Dollar Shares and Notice of Extraordinary General Meeting
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The Reverse Auction Tender Offer will only be available to Eligible Shareholders on the Register as at 5.00 p.m. on Tuesday 16 March 2010.
Eligible Shareholders who hold Shares in certificated form and who wish to tender Shares for purchase in the Reverse Auction Tender Offer should ensure that their completed Tender Forms are returned, so as to be received by the Company's Receiving Agent, Computershare Investor Services PLC, Corporate Actions Projects, Bristol BS99 6AH or by hand (during normal office hours) to Computershare Investor Services PLC, The Pavilions, Bridgwater Road, Bristol BS13 8AE, as soon as possible and, in any event, so as to be received not later than 3.00 p.m. on Monday 19 July 2010. Eligible Shareholders who hold Shares in certificated form should also return their share certificate(s) and/or other documents of title in respect of the Shares tendered. All tender instructions in respect of the Shares will be irrevocable. Any Tender Form received in an envelope postmarked in or otherwise appearing to have been sent or submitted from the United States, Canada, Australia or Japan (the "Restricted Territories") or by Shareholders who are citizens or nationals of, or resident in, any of the Restricted Territories (the "Excluded Overseas Shareholders"), will be rejected as invalid and will be treated as stated in paragraph 1.3 in Part II of this document.
Eligible Shareholders who hold Shares in uncertificated form (that is, through CREST) and who wish to tender their Shares for purchase in the Reverse Auction Tender Offer should ensure that the relevant TTE Instruction is submitted and their completed Tender Forms are returned so as to be received by Computershare before 3.00 p.m. on Monday 19 July 2010. See Part II of this document for further details.
If you have any questions about the procedure for tendering Shares or you want help in filling in the Tender Form, please telephone Computershare between 9.00 a.m. and 5.00 p.m. Monday to Friday, on +44 (0) 8707 074 006. For legal reasons, Computershare will not be able to give advice on the merits of the Reverse Auction Tender Offer or to provide legal, financial or taxation advice and, accordingly, for such advice you should consult your stockbroker, solicitor, accountant, bank manager or other independent professional adviser.
If you do not wish to tender any of your Shares in the Reverse Auction Tender Offer, do not complete a Tender Form or submit a TTE Instruction.
The making of the Reverse Auction Tender Offer in, or to, persons resident in, or citizens or nationals of, jurisdictions outside the United Kingdom ("Overseas Shareholders"), or to persons who are custodians, nominees or trustees for Overseas Shareholders, may be prohibited or affected by the laws of the relevant overseas jurisdiction. Such persons should inform themselves about and observe any applicable legal or regulatory requirements. It is the responsibility of any Overseas Shareholder wishing to tender Shares to satisfy himself as to the full observance of the laws of the relevant jurisdiction in connection therewith, including the obtaining of any governmental, exchange control or other consents which may be required, the compliance with other necessary formalities and the payment of any issue, transfer or other taxes due in such jurisdiction. Any such Shareholder will be responsible for any such issue, transfer or other taxes by whomsoever payable and the Company and any person acting on its behalf shall be fully indemnified and held harmless by such Shareholder for any such issue, transfer or other taxes such person may be required to pay.
In particular, the Reverse Auction Tender Offer is not being, and will not be, made, directly or indirectly, in or into, or by the use of the mails or any means or instrumentality (including, without limitation, telephonically or electronically) of interstate or foreign commerce of, or any facilities of a national securities exchange of, the Restricted Territories or into any other jurisdictions if to do so would constitute a violation of the relevant laws and regulations in such jurisdictions for the account or benefit of any Excluded Overseas Shareholders and the Reverse Auction Tender Offer should not be accepted by any such use, means, instrumentality or facility or from within the Restricted Territories or into any other jurisdictions if to do so would constitute a violation of the relevant laws and regulations in such jurisdictions for the account or benefit of any Excluded Overseas Shareholders. Doing so may render invalid any purported tender. Accordingly, neither this document nor the accompanying Tender Form is being, nor may they be, mailed or otherwise forwarded, distributed or sent in, into or from (whether by use of the mails or any means or instrumentality (including, without limitation, telephonically or electronically) of interstate or foreign commerce of, or any facilities of a national securities exchange) of the Restricted Territories or into any other jurisdictions if to do so would constitute a violation of the relevant laws and regulations in such jurisdictions for the account or benefit of any Excluded Overseas Shareholders. All Shareholders (including, without limitation, nominees, trustees or custodians) who would, or otherwise intend to or who may have a contractual or legal obligation to, forward this document to any jurisdiction outside the United Kingdom, should read the details in this regard which are contained in paragraph 1.3 in Part II of this document before taking any action.
Your attention is drawn to the Risk Factors set out in Part V of this document.
A notice convening an Extraordinary General Meeting of the Company to be held at the offices of BlackRock (Channel Islands) Limited, Forum House, Grenville Street, St Helier, Jersey, JE1 0BR at 3.00 p.m. on Tuesday 29 June 2010 is set out at the end of this document. Forms of Proxy for use at the EGM accompany this document and to be valid must be completed and returned in accordance with the instructions printed thereon, so as to be received by post or by hand by the Company's Registrars, Computershare Investor Services (Jersey) Limited, Ordnance House, 31 Pier Road, St Helier, Jersey, JE4, 8PW or sent by fax to +44 (0) 8708 735 851, not later than 3.00 p.m. on 27 June 2010.
CONTENTS Page
Expected Timetable of Principal Events for the Reverse Auction Tender Offer 4 Part I - Letter from the Chairman of BlackRock Absolute Return Strategies Ltd 5 Part II - Terms and Conditions of the Reverse Auction Tender Offer
12Part III - UK Tax Considerations 23Part IV - Additional Information 24Part V - Risk Factors 25Definitions 26Notice of Extraordinary General Meeting 29 EXPECTED TIMETABLE OF PRINCIPAL EVENTS FOR THE REVERSE AUCTION TENDER OFFEREvent Time and/or dateRecord Date for the Reverse Auction Tender Offer 5.00 p.m. on Tuesday 16 March 2010Reverse Auction Tender Offer announced Wednesday 17 March 2010Circular and Notice of Extraordinary General Meeting posted Friday 30 April 2010
Latest time for lodging Forms of Proxy for BlackRock Absolute Return Strategies Ltd EGM
3.00 p.m. on Sunday 27 June 2010BlackRock Absolute Return Strategies Ltd EGM 3.00 p.m. on Tuesday 29 June 2010Announcement of the results of the EGM Tuesday 29 June 2010Reverse Auction Tender Offer NAV Calculation Date Wednesday 30 June 2010
Latest time and date for receipt of Tender Forms (with share certificates) and delivery of TTE Instructions
3.00 p.m. on Monday 19 July 2010Announcement of the results of the Reverse Auction Tender Offer Tuesday 20 July 2010
Settlement through CREST of unsatisfied tenders for Shares pursuant to the Reverse Auction Tender Offer
Wednesday 21 July 2010Announcement of Strike Price for each class of Shares Monday 2 August 2010
Settlement of the Reverse Auction Tender Offer consideration within 30 Business Days after the
publication of the Net Asset Value per Share as at 30 June 2010 PART I LETTER FROM THE CHAIRMAN OF BLACKROCK ABSOLUTE RETURN STRATEGIES LTD (a registered closed-ended investment company incorporated with limited liability under the laws of Jersey with registered number 100291)Directors: Registered Office:Colin Maltby (Chairman) Forum HouseFrank Le Feuvre Grenville StreetJonathan Ruck Keene JerseyJohn Siska Channel IslandsPhilip Smith JE1 0BR 30 April 2010Dear Shareholder
Proposed Reverse Auction Tender Offer by the Company to purchase up to 801,045
Sterling Shares, 164,178 Euro Shares and 165,505 US Dollar Shares
Introduction
The Company is a Jersey incorporated and registered closed-ended investment company which was launched in April 2008. The Company's issued share capital comprises the Sterling class of Shares, the Euro class of Shares and the US Dollar class of Shares; each of which are traded on the London Stock Exchange and listed on the Official List of the United Kingdom Listing Authority.
Defined terms used in this circular but not otherwise defined shall have the meanings ascribed to them on pages 26 to 28.
Background to and Reasons for the Reverse Auction Tender Offer
In 2009, the Company's Net Asset Value delivered strong positive returns, with the NAVs of the Sterling Shares, Euro Shares and US Dollar Shares appreciating by 22.79 per cent., 22.18 per cent. and 22.66 per cent., respectively. During the period 31 December 2009 to 23 April 2010 this good performance has continued with estimated NAV appreciations of 3.91 per cent., 3.92 per cent. and 3.70 per cent., respectively.
However, the Shares of each class continue to trade in the secondary market at a discount to their NAV. This is in part due to the fact that some Shareholders have decided to reduce their shareholdings in the Company and to the limited liquidity of the Shares in the secondary market. As at 23 April 2010, the Sterling Shares, Euro Shares and US Dollar Shares were trading at 16.67, 16.56 and 13.66 per cent. discounts to NAV respectively.
With the intention of alleviating this selling pressure, the Board announced on 17 March 2010 that, conditional on Shareholder approval, the Company intends to make the Reverse Auction Tender Offer.
The Reverse Auction Tender Offer
The Company intends to provide Shareholders who wish to realise a proportion of their investment with an opportunity to do so by way of the Reverse Auction Tender Offer. Under the proposed Reverse Auction Tender Offer, up to 7.5 per cent. of the Shares of each class in issue on the date hereof (the "Available Shares") will be repurchased by the Company. The Available Shares comprise 801,045 Sterling Shares, 164,178 Euro Shares and 165,505 US Dollar Shares. The aggregate value of the Available Shares, based on the estimated NAV of the Company as at 23 April 2010 and exchange rates as at 23 April 2010, is approximately US$15 million.
The Board believes that the Reverse Auction Tender Offer will provide an exit opportunity for those Eligible Shareholders who wish to realise their investment in the Company, in whole or in part (subject, as explained below, to receipt of tender requests from other Eligible Shareholders and the Discount Levels at which they tender their Shares).
The Reverse Auction Tender Offer will be conducted by way of a reverse auction process which will establish a single discount level (the "Strike Discount") for each class of Shares at which Shares of the relevant class which are successfully tendered will be repurchased. It is expected that proceeds of the tender will be paid (at the recipient's risk) within 30 Business Days after the publication of the Net Asset Value per Share as at 30 June 2010.
The Strike Discount for each class of Share will be determined by an auction process. The Strike Discount will for each class of Shares be a discount to the published NAV per Share of the relevant class as at 30 June 2010. The Strike Discount for each class will be determined on the basis of the Shares of such class tendered and such determination will be independent of the determination of the Strike Discount for each of the other Share Classes. Three separate Strike Discounts (one for each Share class) will therefore be established.
Shares repurchased by the Company pursuant to the Reverse Auction Tender Offer will be held in treasury.
The Reverse Auction Tender Offer is being made on the terms and subject to the conditions set out in this document and the Tender Form.
The Reverse Auction Tender Offer is only available to Eligible Shareholders in respect of those Shares held by each Eligible Shareholder on the Record Date (which shall be deemed to include any Shares which result from the conversion by Eligible Shareholders of Shares held on the Record Date into Shares of another class in respect of the Company's currency conversion calculation date of 31 March 2010).
None of the Directors intend to tender any part of their Shares pursuant to the Reverse Auction Tender Offer.
The Reverse Auction Tender Offer is conditional upon the passing of Resolution 1 in the Notice of Extraordinary General Meeting set out on pages 29 to 32 of this document.
The principal objectives of the Reverse Auction Tender Offer
The principal objectives of the Board in proposing the Reverse Auction Tender Offer are to:
o provide an opportunity to return capital to those Eligible Shareholders seeking to realise, in whole or in part, their investment in the Company (subject to the Minimum Discount Level and, as explained below, to the number of tender requests received from other Eligible Shareholders and the Discount Levels at which such other Eligible Shareholders tender their Shares);o enhance the NAV per Share for continuing Shareholders of each class of Shares which are repurchased at the relevant Strike Discount to NAV pursuant to the Reverse Auction Tender Offer;o seek to narrow the prevailing discount at which the Shares are trading in the secondary market; ando reduce the excess supply of sellers of Shares.
Key Features of the Reverse Auction Tender Offer
The principal terms of the Reverse Auction Tender Offer (which are set out in more detail in Part II of this document) are as follows:
o The Company is making the Reverse Auction Tender Offer to purchase up to 801,045 Sterling Shares, 164,178 Euro Shares and 165,505 US Dollar Shares. The aggregate value of the Available Shares, based on the estimated NAV of the Company as at 23 April 2010 and exchange rates as at 23 April 2010, is approximately US$15 million.o Eligible Shareholders are invited to tender for purchase any or all of their Shares of any class at any Discount Level to the published NAV per Share of that class as at 30 June 2010 up to the Minimum Discount Level of 9 per cent. and in discount increments of 0.5 per cent. In summary, the Strike Discount and Strike Price for each class of Share shall be determined, and the Reverse Auction Tender Offer shall be operated, as follows: - the Strike Discount for each class of Share will be determined on the basis of the number of Shares of the relevant class which are tendered by Eligible Shareholders and the Discount Levels at which such Shares are tendered - no account shall be taken of tenders received in respect of any other class of Shares; - the Strike Discount for each class of Shares will be the widest Discount Level at which the aggregate number of Shares offered for purchase equals or exceeds the Available Shares of that class; - the Strike Price for each class of Shares shall be determined by taking the published NAV per Share of the relevant class as at 30 June 2010 and applying the Strike Discount for that class of Shares as determined by the auction process referred to above; - tenders made at a discount wider than the Strike Discount will be satisfied in full at the Strike Price; - tenders made at the Strike Discount will be scaled back pro-rata to the number of Shares available at the Strike Discount (where necessary); - tenders made at a discount narrower than the Strike Discount will be rejected in their entirety; and - the Strike Discount of each class of Share will be the widest discount to NAV per Share at which the Company could repurchase all the Available Shares for that class. The Directors will, however, have discretion to repurchase substantially all, but not all, of the Available Shares if they consider that doing so, and setting a wider Strike Discount, would be in the best interests of the Company as a whole.o All or part of a registered holding of Shares of any particular class may be tendered at different Discount Levels, but only one tender may be made in respect of any single Share. The total number of Shares tendered by any Eligible Shareholder, even if tendered at various Discount Levels, should not exceed the total number of Shares held by such Shareholder. If the total number of Shares tendered by any Eligible Shareholder exceeds the total number of Shares held by that Eligible Shareholder, they shall be deemed to have tendered the maximum number of Shares held by them and where relevant priority shall be given to the tenders in the order that they are received from that Eligible Shareholder with the first received taking priority and so forth and within a single tender, accepting those Shares with the widest discount until the Shareholder's total number of Shares is accounted for.o The Reverse Auction Tender Offer is only available to Eligible Shareholders and will be in respect of the Shares held by each Eligible Shareholder on the Record Date (which shall be deemed to include any Shares which result from the conversion by Eligible Shareholders of Shares held on the Record Date into Shares of another class in respect of the Company's currency conversion calculation date of 31 March 2010).o The results of the Reverse Auction Tender Offer and the Strike Discounts for each class of Shares will be announced on or around 20 July 2010.o The Strike Price for each class of Shares (calculated after deducting the costs and expenses of the Reverse Auction Tender Offer) will be announced on or around 2 August 2010.o All Shares purchased pursuant to the Reverse Auction Tender Offer will be held in treasury.o Eligible Shareholders who hold Shares in certificated form and who wish to participate in the Reverse Auction Tender Offer must return a completed Tender Form, together with any share certificate(s) and/or other document(s) of title so as to be received by the Receiving Agent by no later than 3.00 p.m. on Monday 19 July 2010. Eligible Shareholders who hold Shares in uncertificated form and who wish to tender their Shares for purchase in the Reverse Auction Tender Offer should ensure that the relevant TTE Instruction is submitted and their completed Tender Forms are returned so as to be received by the Receiving Agent by no later than 3.00 p.m. on Monday 19 July 2010.o Eligible Shareholders do not have to tender any Shares if they do not wish to, but once submitted, a Tender Form and/or TTE Instruction is irrevocable and cannot be withdrawn. Eligible Shareholders should note that, once tendered, the relevant Shares may not be sold, transferred, charged or otherwise disposed of.o Tenders of Shares without any specified Discount Level will be invalid.o If any fractions of Shares arise from scaling back, the number of Shares accepted will be rounded down to the nearest whole number.o The decision of the Board as to the results of the Reverse Auction Tender Offer (including, without limitation, the basis on which excess tenders are satisfied) shall be final and binding on all Shareholders.o Shareholders should note that the Company is entitled not to, and will not, proceed with the Reverse Auction Tender Offer, in the circumstances set out in paragraph 1.1(b) of Part II of this document. This right may only be exercised on or prior to 11.59 p.m. Tuesday 20 July 2010. Shareholders should also note that the Reverse Auction Tender Offer is conditional on Shareholder approval as further set out in paragraph 1.1(a) of Part II of this document.o Invitations to tender under the Reverse Auction Tender Offer will remain open from Friday 30 April 2010 until 3.00 p.m. on Monday 19 July 2010 (unless extended in accordance with the terms set out in this document).o Shares will be purchased by the Company free of commissions and dealing charges.
Please note that the above is a summary only of the principal terms of the Reverse Auction Tender Offer. You should read carefully Part II of this document which contains the full terms and conditions applicable to the Reverse Auction Tender Offer.
Illustrative example
The information set out in the example below is for illustrative purposes only and does not constitute a forecast or any representation or warranty as to the effects of the Reverse Auction Tender Offer on Shareholders.
Example
Assumption: 750,000 Shares available for purchase in a particular Share class, 1,450,000 Shares tendered for purchase
Number Percentage of Shares of Shares Number tendered for tendered for of Shares Cumulative purchase at that purchase at that tendered for number of Discount Level Discount Level purchase at that Shares tendered and successfully and successfullyDiscount Level Discount Level for purchase purchased purchased15.0% 75,000 75,000 75,000 100%14.0% 75,000 150,000 75,000 100%13.0% 100,000 250,000 100,000 100%12.0% 150,000 400,000 150,000 100%11.0% 150,000 550,000 150,000 100%10.0% 400,000 950,000 200,000 50% 9.0% 500,000 1,450,000 0 0%
Comments on illustrative example above
o The Strike Discount for all Shares tendered for purchase in the above illustration would be 10 per cent. being the widest Discount Level at which the aggregate number of Shares tendered for purchase equals or exceeds the Available Shares for that class.o Shares tendered for purchase at Discount Levels wider than the Strike Discount would be purchased in full at the Strike Discount to the published Net Asset Value per Share of that class as at 30 June 2010, less the pro rated costs and expenses of the Reverse Auction Tender Offer.o Shares tendered for purchase at the Strike Discount of 10 per cent. would only be partially (50 per cent.) accepted after scaling back on a pro rata basis.o Eligible Shareholders tendering Shares for purchase at Discount Levels narrower than the Strike Discount will not have any of their Shares purchased.
Proceeds
Sales and realisations of the Company's investments necessary to fund the Reverse Auction Tender Offer will be effected by the Investment Manager however, settlement of the Reverse Auction Tender Offer is conditional on receipt by the Company of sufficient proceeds arising from such Portfolio realisations.
Expenses
The costs and expenses incurred in relation to the Reverse Auction Tender Offer are estimated to amount to approximately (pound)113,000 in aggregate. Such costs and expenses will reduce the Strike Price per Share on a pro rata basis in accordance with the relative NAVs of the Shares in each class which are purchased.
Conversions between Share classes
Pursuant to the Articles and the exercise by the Board of its discretion thereunder, Shareholders of any one class of Shares may convert all or part of their holding into Shares of any other class on a quarterly basis. Any Shareholder who has elected to convert Shares by reference to the 30 June 2010 currency conversion date will be unable to accept the Reverse Auction Tender Offer either for his existing Shares (if he has already submitted a conversion notice in respect of such Shares) or for new Shares arising on conversion.
Overseas Shareholders
The attention of Shareholders who are citizens or residents of jurisdictions outside the United Kingdom, or who are nominees of, or custodians or trustees for, any such person, or who intend to forward this document to any jurisdiction outside the United Kingdom is drawn to paragraph 1.3 of Part II to this document headed "Overseas Shareholders" and to the relevant provisions of the Tender Form, which they should read before taking any action.
The availability of the Reverse Auction Tender Offer to persons not resident in the United Kingdom may be affected by the laws of the jurisdictions in which such persons are resident. Persons who are subject to the laws of any jurisdiction other than the United Kingdom should inform themselves about and observe any applicable requirements.
The making of the Reverse Auction Tender Offer in, or to, persons resident in, or citizens or nationals of, jurisdictions outside the United Kingdom, or to persons who are custodians, nominees or trustees for Overseas Shareholders, may be prohibited or affected by the laws of the relevant overseas jurisdiction. Such persons should inform themselves about and observe any applicable legal or regulatory requirements. It is the responsibility of any Overseas Shareholder wishing to tender Shares to satisfy himself as to the full observance of the laws of the relevant jurisdiction in connection therewith, including the obtaining of any governmental, exchange control or other consents which may be required, the compliance with other necessary formalities and the payment of any issue, transfer or other taxes due in such jurisdiction. Any such Shareholder will be responsible for any such issue, transfer or other taxes by whomsoever payable and the Company and any person acting on their behalf shall be fully indemnified and held harmless by such Shareholder for any such issue, transfer or other taxes such person may be required to pay.
In particular, the Reverse Auction Tender Offer is not being, and will not be, made, directly or indirectly, in or into, or by the use of the mails or any means or instrumentality (including, without limitation, telephonically or electronically) of interstate or foreign commerce of, or any facilities of a national securities exchange of, any of the Restricted Territories or into any other jurisdictions if to do so would constitute a violation of the relevant laws and regulations in such jurisdictions. Copies of this document, the Tender Form and any related offering documents are not being, and may not be, mailed or otherwise distributed in, into or from the Restricted Territories, or to, or for the account or benefit of, any Excluded Overseas Shareholder. Accordingly any Shareholder who is unable to give the representation and warranty set out in paragraph 1.5, headed "Effect of Tender", of Part II of this document may be deemed to have not validly tended their Shares under the Reverse Auction Tender Offer.
Taxation
A summary of the taxation consequences of the Reverse Auction Tender Offer for UK resident Shareholders is set out in Part III of this document.
Any Shareholder who is in any doubt as to their tax position or who is subject to tax in a jurisdiction other than the United Kingdom should consult an appropriate professional adviser.
Notification of Interests
Following the Company's proposed purchase of Shares in relation to the Reverse Auction Tender Offer, a Shareholder's interest in the Company's issued share capital may change giving rise to an obligation on the Shareholder in question to make a notification or a further notification to the Company and the FSA in accordance with the Disclosure and Transparency Rules.
If Shareholders are in any doubt as to whether they should make a notification to the Company and/or the FSA, or as to the form of that notification, they are advised to consult their solicitor or other professional adviser without delay.
Principal purposes of this document
The principal purposes of this document are (i) to provide details of how the Reverse Auction Tender Offer will be implemented and (ii) to provide you with details of, and to propose, the Resolutions (the notice of the EGM is set out at the end of this document).
Extraordinary General Meeting of the Company
Set out on pages 29 to 32 of this document is a notice convening an Extraordinary General Meeting of the Company to be held at 3.00 p.m. on Tuesday 29 June 2010 at the offices of BlackRock (Channel Islands) Limited, Forum House, Grenville Street, St Helier, Jersey JE1 0BR at which the Resolutions (summarised below) will be proposed.
The Resolutions will be proposed as special resolutions requiring not less than a two-thirds majority of votes in favour. The implementation of the Reverse Auction Tender Offer is conditional upon the passing of Resolution 1 as set out in the notice.
Resolution 1 proposes that the Company be authorised to purchase its own Shares pursuant to the Reverse Auction Tender Offer as permitted under Article 57 of the Companies Law. The aggregate amount of repurchases pursuant to the authority will be limited to up to 801,045 Sterling Shares, 164,178 Euro Shares and 165,505 US Dollar Shares. The authority will expire eighteen months from the date of passing of the resolution.
Resolution 2 proposes that the Company be given further authority for a second reverse auction tender offer, which may or may not be implemented at the Board's discretion. If such authority is granted by Shareholders, the Board currently intends that such second reverse auction tender offer will be conducted, if at all, in December 2010. However, the Board reserves the right not to proceed with a second reverse auction tender offer in December 2010 or at all.
Action to be taken
If you are a Shareholder, you will find enclosed with this document the Form(s) of Proxy for use at the Extraordinary General Meeting of the Company. Whether you intend to be present at the Extraordinary General Meeting or not, you are asked to complete the Form(s) of Proxy in accordance with the instructions printed thereon and to return the Form(s) of Proxy to the Company's Registrar, Computershare Investor Services (Jersey) Limited, Ordnance House, 31 Pier Road, St Helier, Jersey, JE4 8PW, as soon as possible and, in any event, so as to arrive not later than 3.00 p.m. on Sunday 27 June 2010. The completion and return of the Form(s) of Proxy will not preclude you from attending the Extraordinary General Meeting and voting in person if you wish to do so.
The procedure for tendering your Shares, if you wish to do so, depends on whether your Shares are held in certificated form or uncertificated form and is summarised below:
(i) Shares held in certificated form
Eligible Shareholders who hold Shares in certificated form and who wish to tender all or any of their existing holdings of Shares should complete the Tender Form, in accordance with the instructions printed thereon (including a witnessed signature) and in Part II of this document, and return by post. Eligible Shareholders who hold their Shares in certificated form should also return with the relevant Tender Form their share certificate(s) and/or other document(s) of title in respect of the Shares tendered. Completed Tender Forms must be received by not later than 3.00 p.m. on Monday 19 June 2010. Further details of the procedures for tendering and settlement are set out in Part II of this document and in the accompanying Tender Form. Without prejudice to Part II of this document, the Company reserves the right to treat as valid in whole or in part any acceptance of the Reverse Auction Tender Offer in relation to Shares in certificated form which is not entirely in order or which is not accompanied by the relevant share certificate(s) and/or other document(s) of title. In that event, no payment of cash under the Reverse Auction Tender Offer will be made until after (as applicable) the relevant share certificate(s) and/or other document(s) of title or indemnities satisfactory to the Company have been received.
(ii) Shares held in uncertificated form
Eligible Shareholders who hold their Shares in uncertificated form and who wish to tender all or any of their existing holdings of Shares should complete the Tender Form, in accordance with the instructions printed thereon (including a witnessed signature) and in Part II of this document, and return by post. Completed Tender Forms must be received by not later than 3.00 p.m. on Monday 19 June 2010. Eligible Shareholders should also arrange for the relevant TTE Instruction in respect of the aggregate number of Shares tendered for purchase to be submitted to Computershare in accordance with CREST procedures to be delivered as soon as possible and by no later than 3.00 p.m. on Monday 19 July 2010. Further details of the procedures for tendering and settlement are set out in Part II of this document and in the accompanying Tender Form.
If you do not wish to tender any of your Shares for purchase pursuant to the Reverse Auction Tender Offer, do not complete or return a Tender Form and/or submit a TTE Instruction. You are, nonetheless, urged to return your Form(s) of Proxy as discussed below under the heading "Recommendation".
The Company will make an appropriate announcement to an RIS if any of the details contained in paragraph (i) or (ii) above alter for any reason.
Additional Information
Eligible Shareholders who do not wish to sell any Shares under the Reverse Auction Tender Offer need take no action in relation to the Tender Form or otherwise. If you are in any doubt about the completion of the Tender Form, please telephone Computershare between 9.00 a.m. and 5.00 p.m. Monday to Friday, on +44 (0) 8707 074 006.
Your attention is also drawn to the further information contained in this document and in particular to the risk factors set out in Part V of this document. You are advised to read the whole document and not merely rely on the key or summarised information in this letter.
Recommendation
In the Board's opinion, the Reverse Auction Tender Offer is in the best interests of the Company and the Shareholders as a whole. The Directors unanimously recommend that you vote in favour of the Resolutions, as they intend to do in respect of their own beneficial holdings. Each member of the Board who holds Shares intends to vote in favour of the Resolutions. In aggregate, the number of Shares held by the Board is 5,000 Sterling and 4,366 Euro denominated Shares.
The Directors are making no recommendation to Shareholders, however, in relation to participation in the Reverse Auction Tender Offer. Whether or not Shareholders decide to tender their Shares will depend, amongst other things, on their own individual circumstances, including their own tax position. Shareholders are recommended to consult their duly authorised independent advisers in making their own decisions.
Shareholders are referred to certain risk factors associated with the Reverse Auction Tender Offer which are set out in Part V of this document.
None of the Directors intend to tender any part of their Shares pursuant to the Reverse Auction Tender Offer.
Yours faithfully
Colin MaltbyChairmanBlackRock Absolute Return Strategies Ltd. PART II TERMS AND CONDITIONS OF THE REVERSE AUCTION TENDER OFFER
1. TERMS AND CONDITIONS OF THE REVERSE AUCTION TENDER OFFER
The Company hereby invites Eligible Shareholders to offer to sell Shares to the Company on and subject to the following conditions and further terms:
1.1 Conditions of the Reverse Auction Tender Offer
The Reverse Auction Tender Offer is subject to the following conditions:
(a) the passing at an Extraordinary General Meeting of the Company (or at any
adjournment thereof) of Resolution 1 set out in the Notice of Extraordinary
General Meeting dated 30 April 2010 set out on pages 29 to 32 of this
document; and
(b) if at any time on or prior to 11.59 p.m. on Tuesday 20 July 2010:
(i) the Directors of the Company conclude that the Reverse Auction Tender Offer would no longer be in the best interests of the Company as a whole; or (ii) there shall occur any material adverse change in the national or international, financial, economic, political or market conditions; or (iii) having regard to the financial position or prospects and/or circumstances of the Company and to the intentions of the Directors of the Company with respect to the management of the Company and the amount and character of the financial resources available to the Company, the Directors conclude that they will not be able to make a written statement certifying that in their opinion the Company will be able to continue to carry on its business and discharge its liabilities as they fall due until the expiry of 12 months immediately following settlement of the Reverse Auction Tender Offer consideration, which, in respect of (ii) and (iii) above, in the reasonable opinion of the Directors of the Company and/or pursuant to the provisions of the Companies Law, renders the Reverse Auction Tender Offer temporarily or permanently impractical or inadvisable and/or not permissible (taking into account the background to and reasons for the Reverse Auction Tender Offer) (the conditions in paragraphs (a) and (b) being the "Conditions").
If the Conditions are not satisfied or waived by the Company (in its sole discretion) then the Company shall terminate the Reverse Auction Tender Offer and shall, as soon as practicable thereafter, announce the same through a RIS.
If the Company terminates the Reverse Auction Tender Offer pursuant to this paragraph 1.1 of Part II, the Reverse Auction Tender Offer will lapse and the Company will not purchase any Shares pursuant to the Reverse Auction Tender Offer.
1.2 Terms of the Reverse Auction Tender Offer 1.2.1 Each Share may be tendered under the Reverse Auction Tender Offer at any Discount Level (expressed in 0.5 per cent. increments). Eligible Shareholders may tender their holding of Shares at more than one Discount Level but only one tender may be made in respect of any single Share. Only tenders made at 0.5 per cent. increments and subject to the Minimum Discount Level can be accepted. 1.2.2 The Strike Discount for each class of Share will be determined on the basis of the number of Shares of the relevant class which are tendered by Eligible Shareholders and the Discount Levels at which such Shares are tendered - no account shall be taken of tenders received in respect of any other class of Shares. 1.2.3 The Strike Discount for each class of Shares will be the widest Discount Level at which the aggregate number of Shares offered for purchase equals or exceeds the Available Shares of that class. 1.2.4 Tenders made at a discount wider than the Strike Discount will be satisfied in full at the Strike Price. 1.2.5 Tenders made at the Strike Discount will be scaled back pro-rata to the number of Shares available at the Strike Discount (where necessary). 1.2.6 Tenders made at a discount narrower than the Strike Discount will be rejected in their entirety. 1.2.7 The Strike Discount of each class of Share will be the widest discount to NAV per Share at which the Company could repurchase all the Available Shares. The Directors will, however, have discretion to repurchase substantially all, but not all, of the Available Shares if they consider that doing so, and setting a wider Strike Discount, would be in the best interests of the Company as a whole. 1.2.8 All or part of a registered holding of Shares of any particular class may be tendered at different Discount Levels, but only one tender may be made in respect of any single Share. The total number of Shares tendered by any Eligible Shareholder, even if tendered at various Discount Levels, should not exceed the total number of Shares held by such Shareholder. If the total number of Shares tendered by any Eligible Shareholder exceeds the total number of Shares held by that Eligible Shareholder, they shall be deemed to have tendered the maximum number of Shares held by them and where relevant priority shall be given to the tenders in the order that they are received from that Eligible Shareholder with the first received taking priority and so forth and within a single tender, accepting those Shares with the widest discount until the Shareholder's total number of Shares is accounted for. 1.2.9 The Reverse Auction Tender Offer is only available to Eligible Shareholders and will be in respect of the Shares held by each Eligible Shareholder on the Record Date (which shall be deemed to include any Shares which result from the conversion by Eligible Shareholders of Shares held on the Record Date into Shares of another class in respect of the Company's currency conversion calculation date of 31 March 2010). 1.2.10 Eligible Shareholders do not have to tender any Shares if they do not wish to, but once submitted, a Tender Form and/or TTE Instruction regarding acceptance of the tender is irrevocable and cannot be withdrawn. Eligible Shareholders should note that, once tendered, the relevant Shares may not be sold, transferred, charged or otherwise disposed of. 1.2.11 Tenders of Shares without any specified Discount Level will be invalid. 1.2.12 If any fractions of Shares arise from scaling back, the number of Shares accepted will be rounded down to the nearest whole number. 1.2.13 The decision of the Board as to the results of the Reverse Auction Tender Offer (including, without limitation, the basis on which excess tenders are satisfied) shall be final and binding on all Shareholders. 1.2.14 Shareholders should note that the Company is entitled not to, and will not, proceed with the Reverse Auction Tender Offer, in the circumstances set out in paragraph 1.1 of Part II of this document. This right may only be exercised on or prior to 11.59 p.m. Tuesday 20 July 2010. Shareholders should also note that the Reverse Auction Tender Offer is conditional on shareholder approval as further set out in paragraph 1.1 of Part II of this document. 1.2.15 Invitations to tender under the Reverse Auction Tender Offer will remain open from Friday 30 April 2010 until 3.00 p.m. on Monday 19 July 2010 in (unless extended in accordance with the terms set out in this document). 1.2.16 Shares will be purchased by the Company under the Reverse Auction Tender Offer free of commissions and dealing charges. 1.2.17 Tender Forms which have been, or are deemed to be, validly and properly completed and received by Computershare, by 3.00 p.m. on Monday 19 July 2010 will become irrevocable at such time as they are received. 1.2.18 The Reverse Auction Tender Offer will close at 3.00 p.m. on Monday 19 July 2010 in respect of invitations to tender Shares and no Tender Forms or tender instructions received after that time will be accepted in whole or in part, except to the extent that the Board resolves to extend the period for tendering under the Reverse Auction Tender Offer, in which case a new date for the Reverse Auction Tender Offer will be given. The Board reserves the right, subject to applicable legal and regulatory requirements, to extend the period for tendering under the Reverse Auction Tender Offer at any time prior to 3.00 p.m. on Monday 19 July 2010. Any material change to the expected timetable will be notified to Shareholders by way of an announcement through a RIS. Any such extension will comply with all applicable legal and regulatory requirements including, but not limited to, the duration of such extension. 1.2.19 All or any part of a holding of Shares may be tendered. Subject to the satisfaction of the Conditions referred to above, Shares successfully tendered will be purchased by the Company fully paid and free from all liens, charges, equitable interests and encumbrances. 1.2.20 Pursuant to the Reverse Auction Tender Offer, the aggregate number of Sterling Shares purchased shall not in any event exceed 801,045 Sterling Shares, the aggregate number of Euro Shares purchased shall not in any event exceed 164,178 Euro Shares and the aggregate number of US Dollar Shares purchased shall not in any event exceed 165,505 US Dollar Shares. 1.2.21 All tenders in respect of Shares must be made on the accompanying Tender Form duly completed in accordance with the instructions set out below and in the Tender Form. The terms, provisions and instructions contained in or deemed to be incorporated in the Tender Form will also constitute part of the terms of the Reverse Auction Tender Offer. Words and expressions defined in this document shall have the same meanings when used in the Tender Form unless the context otherwise requires. The provisions of this Part II shall be deemed incorporated into the Tender Form. 1.2.22 The Reverse Auction Tender Offer and all tenders in respect thereof, or pursuant thereto, and all contracts made pursuant thereto and any action taken or made or deemed to be taken or made under any of the foregoing shall be governed by and construed in accordance with English law. Execution of a Tender Form or sending of the appropriate TTE Instruction, will constitute submission to the exclusive jurisdiction of the English courts by the relevant Eligible Shareholder and his agreement that nothing shall limit the right of the Company to bring any action, suit, or proceeding arising out of or in connection with the Reverse Auction Tender Offer or the Tender Form in any other manner permitted by law or in any court of competent jurisdiction. 1.2.23 It is expected that the results of the Reverse Auction Tender Offer will be announced on Tuesday 20 July 2010 and that the Strike Prices will be announced on Monday 2 August 2010. 1.2.24 All documents and remittances sent by or to Shareholders will be sent at the risk of the Shareholder concerned. If the Reverse Auction Tender Offer does not become unconditional and lapses or if in accordance with the terms of the Reverse Auction Tender Offer a tender cannot be accepted, (i) in the case of certificated Shares, share certificates and other documents of title will be returned by post to the person whose name and address (outside the Restricted Territories) is set out in Box 1 of the Tender Form or, if relevant, to the person whose name and address (outside the Restricted Territories) is set out in Box 3 of the Tender Form, in each case by no later than ten business days after the date of such lapse or non-acceptance; (ii) in the case of Uncertificated Shares, Shares transferred to escrow will be released. 1.2.25 If part only of a holding of Shares is successfully tendered pursuant to the Reverse Auction Tender Offer, the relevant Eligible Shareholder will be entitled to receive the following: (A) if Shares are held in certificated form - a balance certificate in respect of the unsold Shares; or (B) if the Shares are held in uncertificated forms - the crediting of the relevant CREST account of Eligible Shareholders with the balance of their unsold Shares. 1.2.26 Further copies of the Tender Form may be obtained on request from Computershare by calling between 9.00 a.m. and 5.00 p.m. Monday to Friday on +44 (0) 8707 074 006 or at the address of Computershare. 1.2.27 Holdings of Shares in certificated form and holdings of Shares in uncertificated form under the same name with different designations will be treated as separate shareholdings for the purposes of the application of terms of the Reverse Auction Tender Offer and separate Tender Forms will need to be submitted in order to tender each such separate holding. 1.2.28 The Board reserves the absolute right to reject any or all tenders it determines not to be in proper form or the acceptance of payment for which may, in the opinion of the Board, be unlawful. The Board also reserves the right to treat as valid in whole or in part tenders which are not entirely in order or which are not accompanied by the relevant share certificate(s) and/or other document(s) of title or in the case of holdings of Shares in uncertificated form, if the relevant TTE Instruction has not been made. No tender of Shares will be deemed to be validly made until all defects or irregularities (if any) have been cured or waived. In the event of a waiver, the consideration under the Reverse Auction Tender Offer will not be despatched until after the Tender Form is complete in all respects and the share certificates and/or other document(s) of title satisfactory to the Board have been received or in the case of holdings of Shares in uncertificated form, the relevant TTE Instructions have settled (as the case may be). 1.2.29 None of the Company, the Receiving Agent, or any other person is or will be obliged to give notice of any defects or irregularities in tenders and none of them will incur any liability for failure to give any such notice. 1.2.30 The failure of any person to receive a copy of this document and/or, the Tender Form shall not invalidate any aspect of the Reverse Auction Tender Offer. None of the Company, the Receiving Agent or any other person will incur any liability in respect of any person failing to receive this document and/or the Tender Form. 1.2.31 The Board reserves the right to change the number of Shares available for repurchase under the Reverse Auction Tender Offer, based on market conditions and/or other factors, subject to compliance with applicable law and regulatory requirements. Any such revision may require, amongst other things, that new Tender Forms are despatched to Shareholders and may, in certain circumstances, require that the period of the Reverse Auction Tender Offer be extended. 1.2.32 No acknowledgement of receipt of any Tender Form, share certificate(s), other document(s) of title or other instructions (as appropriate) will be given. Any omission or failure to despatch this document, the Tender Form or any notice required to be despatched under the terms of the Reverse Auction Tender Offer to, or any failure to receive the same by, any person to whom the Reverse Auction Tender Offer is made, or should be made, shall not invalidate the Reverse Auction Tender Offer in any way or create any implication that the Reverse Auction Tender Offer has not been made to any such person. The Reverse Auction Tender Offer extends to persons to whom the Reverse Auction Tender Offer is made or should be made but to whom this document, the Tender Form or any related documents may not be despatched or by whom such documents may not be received, and such persons may collect copies of these documents from Computershare. 1.2.33 The provisions of the Contracts (Rights of Third Parties) Act 1999 shall not apply to the agreements arising from the acceptance of the Reverse Auction Tender Offer or any collateral agreements relating to the Reverse Auction Tender Offer.1.3 Overseas Shareholders(a) The making of the Reverse Auction Tender Offer in, or to, persons resident in, or citizens or nationals of, jurisdictions outside the United Kingdom, or to persons who are custodians, nominees or trustees for, persons who are citizens, residents or nationals of such jurisdictions may be prohibited or affected by the laws of the relevant overseas jurisdiction. Such persons should inform themselves about and observe any applicable legal or regulatory requirements. It is the responsibility of any such Shareholder wishing to tender Shares to satisfy himself as to the full observance of the laws of the relevant jurisdiction in connection therewith, including the obtaining of any governmental, exchange control or other consents which may be required, the compliance with other necessary formalities and the payment of any issue, transfer or other taxes due in such jurisdiction. Any such Shareholder will be responsible for any such issue, transfer or other taxes by whomsoever payable and the Company and any person acting on their behalf shall be fully indemnified and held harmless by such Shareholder for any such issue, transfer or other taxes such person may be required to pay.(b) In particular, the Reverse Auction Tender Offer is not being, and will not be, made, directly or indirectly, in or into, any of the Restricted Territories, or by the use of the mails of, or by any means or instrumentality (including, without limitation, telephonically or electronically) of interstate or foreign commerce of, or any facility of a national securities exchange of, any of the Restricted Territories, and the Reverse Auction Tender Offer should not be tendered to by any such use, means, instrumentality or facility or from within any of the Restricted Territories. Accordingly, copies of this document, the Tender Form and any related documents are not being and must not be mailed or otherwise forwarded, distributed or sent in, into or from any of the Restricted Territories or into any other jurisdiction if to do so would constitute a violation of the relevant laws and regulations in such jurisdictions. Persons receiving such documents (including, without limitation, custodians, nominees and trustees) should not distribute them in, into or from any of the Restricted Territories or to Excluded Overseas Shareholders, or use the mails or any such means, instrumentality or facility, for any purpose directly or indirectly in connection with the Reverse Auction Tender Offer, and so doing may render invalid any purported tender under the Reverse Auction Tender Offer. Persons wishing to tender pursuant to the Reverse Auction Tender Offer should not use such mails or any such means, instrumentality or facility for any purpose, directly or indirectly, relating to any tender under the Reverse Auction Tender Offer. Envelopes containing Tender Forms should not be postmarked in any of the Restricted Territories or otherwise despatched from any of the Restricted Territories and all tendering Shareholders must provide addresses outside the Restricted Territories for the remittance of cash or return of any documents.(c) A Shareholder will be deemed not to have tendered Shares pursuant to the Reverse Auction Tender Offer if (i) such Shareholder is unable to make the representations and warranties set out in paragraph 1.5 (headed "Effect of Tender") in this Part II; (ii) such Shareholder has a registered address in any of the Restricted Territories; or (iii) such Shareholder inserts in Box 3 of a Tender Form the name and address of the person or agent in any of the Restricted Territories to whom he wishes the consideration to which such Shareholder is entitled under the Reverse Auction Tender Offer to be sent; or (iv) the Tender Form received from him is in an envelope postmarked in, or which otherwise appears to the Company or its agents to have been sent from any of the Restricted Territories. The Company reserves the right, in its absolute discretion, to investigate in relation to any tender, whether the representations and warranties referred to in paragraph 1.5 (headed "Effect of Tender") in this Part II given by any Shareholder are correct and, if such investigation is undertaken and as a result the Company determines (for any reason) that such representation and warranty is not correct, such tender shall not be valid. If, in connection with making the Reverse Auction Tender Offer, notwithstanding the restrictions described above, any person (including, without limitation, custodians, nominees and trustees), whether pursuant to a contractual or legal obligation or otherwise, forwards this document, the Tender Form or any related documents in, into or from any of the Restricted Territories, such person should: (i) inform the recipient of such fact; (ii) explain to the recipient that such action may invalidate any purported tender by the recipient; and (iii) draw the attention of the recipient to this paragraph 1.3 headed "Overseas Shareholders" in this Part II.(d) The Company reserves the right to notify any matter, including the fact that the Reverse Auction Tender Offer has been made, to all or any Shareholders: (i) who are Overseas Shareholders; or (ii) whom the Company knows to be a custodian, trustee or nominee holding Shares for persons who are Overseas Shareholders; by announcement or by paid advertisement in a daily national newspaper published and circulated in the United Kingdom (in which event such notice shall be deemed to have been sufficiently given, notwithstanding any failure by any such Shareholders to receive or see such notice) and all references in this document to notice or the provision of information in writing by or on behalf of the Company shall be construed accordingly.(e) The provisions of this paragraph 1.3 override any terms of the Reverse Auction Tender Offer inconsistent with them. The provisions of this paragraph 1.3 and/or any other terms of the Reverse Auction Tender Offer relating to Overseas Shareholders may be waived, varied or modified as regards specific Shareholders or on a general basis by the Directors in their absolute discretion.(f) References in this paragraph 1.3 to a Shareholder shall include the persons or persons executing a Tender Form and, in the event of more than one person executing a Tender Form, the provisions of this paragraph shall apply to them jointly and to each of them.(g) The provisions in this paragraph 1.3 and/or any other terms of the Reverse Auction Tender Offer relating to Overseas Shareholders may be waived, varied or modified as regards a specific Shareholder or on a general basis by the Company in its absolute discretion but only if the Company is satisfied that such waiver, variation or modification will not constitute or give rise to breach of applicable securities or other laws.
Overseas Shareholders should inform themselves about and observe any applicable legal or regulatory requirements. If you are in any doubt about your position, you should consult your professional adviser in the relevant territory.
1.4 Procedure for Tendering
(a) Different procedures for Shares in certificated form and for Shares in
uncertificated form If you hold Shares in certificated form, you may only tender such Shares by completing and returning the Tender Form in accordance with the instructions set out in paragraph 1.4(b) below and the instructions printed thereon. If you hold Shares in certificated form but under different designations, you should complete a separate Tender Form, as appropriate, in respect of each designation. Additional Tender Forms are available from Computershare by telephone on +44 (0) 8707 074 006 if calling from outside the United Kingdom.
(b) Shares held in certificated form
To tender your Shares held in certificated form you must complete, sign and have witnessed the Tender Form. The completed, signed and witnessed Tender Form should be sent either by post to Computershare Investor Services PLC, Corporate Actions Projects, Bristol, BS99 6AH or by hand (during normal business hours only) to Computershare Investor Services PLC at The Pavilions, Bridgwater Road, Bristol BS13 8AE, as soon as possible and, in any event, so as to be received not later than 3.00 p.m. on Monday 19 July 2010. No tenders received after that time will be accepted. No acknowledgement of receipt of documents will be given. Any Tender Form received in an envelope postmarked in any of the Restricted Territories or otherwise appearing to the Company or its agents to have been sent from any of the Restricted Territories may be rejected as an invalid tender. For further information on Overseas Shareholders, see paragraph 1.3 (headed "Overseas Shareholders") in this Part II. The completed and signed Tender Form should be accompanied, where possible, by the relevant share certificate(s) and/or other document(s) of title. If your share certificate(s) and/or other document(s) of title is/are not readily available (for example, if they are with your stockbroker, bank or other agent) or are lost, the Tender Form should nevertheless be completed, signed and returned as described above so as to be received by Computershare Investor Services PLC, Corporate Actions Projects, Bristol, BS99 6AH not later than 3.00 p.m. on Monday 19 July 2010, together with any share certificate(s) and/or documents(s) of title that you may have available with a note of explanation stating that the remaining documents will follow as soon as possible or that you have lost one or more of your share certificate(s) and/or other document(s) of title. The relevant share certificate(s) and document(s) of title should be forwarded as soon as possible thereafter and, in any event, so as to arrive by not later than 3.00 p.m. on Monday 19 July 2010. In respect of those Shares for which your share certificate(s) is/are lost, you should complete a letter of indemnity, which can be obtained by writing to Computershare Investor Services PLC, Corporate Actions Projects, Bristol, BS99 6AH. This indemnity should be returned as described above so as to be received by Computershare Investor Services PLC, Corporate Actions Projects, Bristol, BS99 6AH, not later than 3.00 p.m. on Monday 19 July 2010. Where you have returned a letter of indemnity in respect of unavailable share certificate(s) and you subsequently find or obtain the relevant share certificate(s), you should immediately send the share certificate(s) by hand during normal business hours only or by post to Computershare, as described above. If a Shareholder does not return his share certificate(s) by 3.00 p.m. on Monday 19 July 2010, the Company may deem (in its absolute discretion) that such Shareholder has only tendered the number of Shares in respect of which share certificates have been received. If the Reverse Auction Tender Offer does not become unconditional and lapses, or is terminated, Tender Forms, share certificates and other documents of title will be returned to Eligible Shareholders by post not later than 10 business days after the date of such lapse.
(c) Shares held in uncertificated form
To tender your Shares held in uncertificated form you must send (or, if you have a CREST sponsor, procure that your CREST sponsor sends) a separate TTE Instruction to Euroclear for each class of Shares that you wish to tender for purchase which must be properly authenticated in accordance with its specifications, as well as completing a Tender Form. Your completed, signed and witnessed Tender Form should be sent either by post to Computershare Investor Services PLC, Corporate Actions Projects, Bristol, BS99 6AH or by hand (during normal business hours only) to Computershare Investor Services PLC at The Pavilions, Bridgwater Road, Bristol BS13 8AE, as soon as possible and, in any event, so as to be received not later than 3.00 p.m. on Monday 19 July 2010. No tenders received after that time will be accepted. No acknowledgement of receipt of documents will be given. Any Tender Form received in an envelope postmarked in any of the Restricted Territories or otherwise appearing to the Company or its agents to have been sent from any of the Restricted Territories may be rejected as an invalid tender. For further information on Overseas Shareholders, see paragraph 1.3 (headed "Overseas Shareholders") in this Part II. Each TTE Instruction must contain, in addition to the other information that is required for the TTE Instruction to settle in CREST, the following details: o the number of Shares of the relevant class of Shares to be transferred to an escrow balance (this must be the maximum number tendered for purchase); o your CREST participant ID; o your CREST member account ID; o the participant ID 3RA27 of the escrow receiving agent (Computershare) in its capacity as a CREST receiving agent; o the member account ID for the relevant class of Shares of the escrow receiving agent (Computershare), which will be BRTENGBP in respect of the Sterling Shares, BRTENEUR in respect of the Euro Shares and BRTENUSD in respect of the US Dollar Shares; o the corporate action ISIN for relevant class of Shares which is JE00B2PXDB91 in respect of the Sterling Shares, JE00B2PXNC07 in respect of the Euro Shares and JE00B2PXNQ43 in respect of the US Dollar Shares; o the corporate action number for the Reverse Auction Tender Offer, which is allocated by Euroclear and can be found by viewing the relevant corporate actions details in CREST; o the Tender Form reference number and contact name and number for the Eligible Shareholder or its agent to be inserted in the shared note field; o the intended settlement date for the transfer to escrow which should be as soon as practicable in any event no later than 3.00 p.m. on Monday 19 July 2010; and o input with the standard delivery instruction priority of 80. Shares for which a valid TTE Instruction have been submitted will be transferred to escrow in CREST. It will not, therefore, be possible to access or otherwise deal in such Shares and such Shares will be held in escrow pending the closing of the Reverse Auction Tender Offer, at which time Shares being purchased will be held in escrow whilst Shares unsuccessfully tendered will be re-transferred to the relevant CREST stock account.
(d) Deposits of Shares into, and withdrawals of Shares from, CREST
Normal CREST procedures (including timings) apply in relation to any Shares that are, or are to be, converted from uncertificated to certificated form, or from certificated to uncertificated form, during the course of the Reverse Auction Tender Offer (whether such conversion arises as a result of a transfer of Shares or otherwise). Shareholders who are proposing to convert any such Shares are recommended to ensure that the conversion procedures are implemented in sufficient time to enable the person holding or acquiring the Shares as a result of the conversion to take all necessary steps in connection with such person's participation in the Reverse Auction Tender Offer (in particular, as regards delivery of share certificates and/or other documents of title prior to 3.00 p.m. on Monday 19 July 2010). If you are in any doubt as to how to complete the Tender Form please telephone Computershare between 9.00 a.m. and 5.00 p.m. Monday to Friday on +44 (0) 8707 074 006. For legal reasons, Computershare will not be able to give advice on the merits of the Reverse Auction Tender Offer or to provide legal, financial or taxation advice, and accordingly, for such advice you should consult your stockbroker, solicitor, accountant, bank manager or other independent professional adviser. Shareholders should note that once tendered, Shares may not be sold, transferred, charged or otherwise disposed of.
1.5 Effect of Tender
Each Shareholder by whom, or on whose behalf, a Tender Form is executed irrevocably undertakes, represents, warrants and agrees to and with the Company and the Receiving Agent (so as to bind him, his personal or legal representatives, heirs, successors and assigns) that:
(a) in respect of an Eligible Shareholder by whom, or on whose behalf, a Tender Form is executed and/or a TTE Instruction is sent, the execution of the Tender Form and, if applicable, submission of valid share certificate(s) or document(s) that shall constitute an offer to sell to the Company at the specified Discount Level(s), the Shares detailed in Box 1 of the Tender Form or deemed to be inserted (or such lesser number of Shares as is accepted for purchase pursuant to the Reverse Auction Tender Offer), in each case on and subject to the terms and conditions set out and referred to in this document and the relevant Tender Form and that, once lodged, such offer shall be irrevocable;(b) such Shareholder has full power and authority to tender, sell, assign or transfer the Shares in respect of which such offer is accepted (together with all rights attaching thereto) and when the same are purchased, the Company will acquire such Shares fully paid and free from all liens, charges and encumbrances, rights of pre-emption and any other third party rights of any nature whatsoever and together with all rights attaching thereto on 20 July 2010, including the right to vote the Shares and to receive all dividends and other distributions declared, paid or made on or after 20 July 2010;(c) the execution of the Tender Form and/or the execution of a TTE Instruction will, subject to the Reverse Auction Tender Offer becoming unconditional, constitute the irrevocable appointment of any director or officer of the Company, or other person(s) nominated by the Company, as such Shareholder's attorney and/or agent ("attorney") and an irrevocable instruction and authorisation for the attorney to complete and execute all or any instruments of transfer and/or the purchase contract and/or other documents at the attorney's discretion in relation to the Shares being tendered by that Shareholder in favour of the Company and to deliver such instruments of transfer and/or the purchase contract and/or other documents at the discretion of the attorney, together with the share certificate(s) and/or any other documents relating to such Shares, for registration within 6 months of the Reverse Auction Tender Offer becoming unconditional and to do all such other acts and things as may, in the opinion of such attorney, be necessary or expedient for the purpose of, or in connection with the Reverse Auction Tender Offer and to vest in the Company or its nominee(s) such Shares;(d) such Shareholder agrees to ratify and confirm each and every act or thing which may be done or effected by such attorney and/or by the Company or any of its directors in the proper exercise of its or his or her powers and/or authorities hereunder;(e) such Shareholder holding Shares in certificated form will deliver to the Receiving Agent their share certificate(s) and/or other document(s) or title in respect of the Shares being tendered by that Shareholder or an indemnity acceptable to the Company in lieu thereof or will procure that the delivery of such document(s) to such person as soon as possible thereafter and, in any event, before 3.00 p.m. on Monday 19 July 2010;(f) such Shareholder shall do all such things and acts as shall be necessary or expedient and execute any additional documents deemed by the Company to be desirable to complete the Company's purchase of the Shares and/or to perfect any of the authorities expressly given hereunder;(g) such Shareholder, if an Overseas Shareholder, has fully observed and complied with any applicable legal requirements so that the invitation under the Reverse Auction Tender Offer may be lawfully made to him under the laws of the relevant jurisdiction;(h) such Shareholder: (i) is not an Excluded Overseas Shareholder; (ii) does not hold any Shares which he has tendered on behalf of an Excluded Overseas Shareholder; (iii) has not received or sent copies or originals of this document, the Tender Form or any related document in, into or from any of the Restricted Territories; (iv) is tendering Shares pursuant to the Reverse Auction Tender Offer from outside the Restricted Territories; (v) is not an agent or a fiduciary acting on a non-discretionary basis for the principal who has given any instructions with respect to the Reverse Auction Tender Offer from within any of the Restricted Territories; (vi) has not received this document or the accompanying Tender Form relating to the Reverse Auction Tender Offer, and has not otherwise utilised in connection with the Reverse Auction Tender Offer, directly or indirectly, the mails of or any means or instrumentality (including, without limitation, telephonically or electronically) of interstate or foreign commerce of, or any facility of a national securities exchange of, any of the Restricted Territories, or into any other jurisdictions if to do so would constitute a violation of the relevant laws and regulations in such jurisdictions; (vii) acknowledges that any Tender Form received from an Excluded Overseas Shareholder, or from a person acting for, of for the account of benefit of, an Excluded Overseas Shareholder, or that otherwise appears to have been sent or submitted from any Restricted Territory, will be rejected as invalid and will be treated as stated in the section headed "Overseas Shareholders" in Part II of this document; (viii) acknowledges that the Shares have not been, and will not be, registered under the US Securities Act or under any relevant securities laws of any state or territory, or other jurisdiction of the United States and may not be, offered, sold, resold, delivered or distributed, directly or indirectly, in or into the United States, or for the account or benefit of, any US Person, and that the Shares has not been and will not be registered under the US Investment Company Act and Shareholders have not been and will not be, entitled to the benefits of the US Investment Company Act; (ix) wishes to participate in the Reverse Auction Tender Offer on the conditions set out in this document; and (x) has read and understood Paragraph 1.3, the section headed "Overseas Shareholders", in Part II of this document.(i) the creation of an assured payment obligation in favour of a Shareholder's payment bank in accordance with the CREST assured payment arrangements as referred to in paragraph 1.6 (headed "Purchase of Shares and Settlement") in this Part II will, to the extent of the obligations so created, discharge fully any obligation of the Company to pay to such Shareholder the cash consideration to which he is entitled pursuant to the Reverse Auction Tender Offer;(j) on execution each Tender Form takes effect as a deed;(k) that, subject to the Reverse Auction Tender Offer becoming unconditional, the execution of a Tender Form and/or the execution of a TTE Instruction, constitutes an irrevocable authorisation and request: (i) if the Shares concerned are in certificated form, to the Company to procure the despatch by post of a cheque for the cash consideration to which a tendering Shareholder is entitled, at the risk of such Shareholder, to the registered holder(s); and (ii) if the Shares concerned are in uncertificated form, to the Company to procure the creation of an assured payment obligation in favour of the payment bank of the tendering Eligible Shareholders in accordance with the CREST assured payment arrangements in respect of the cash consideration to which such Eligible Shareholder is entitled;(l) that the execution of a Tender Form and/or the execution of a TTE Instruction constitutes such Shareholder's submission to the jurisdiction of the courts of England in relation to all matters arising out of or in connection with the Reverse Auction Tender Offer or the Tender Form; and(m) the execution of the Tender Form and/or the execution of a TTE Instruction (as appropriate) constitutes a warranty by such Shareholder that the information given by or on behalf of the Shareholder in the Tender Form and/or in the TTE Instruction will be true in all respects at the time the Company purchases the Shares referred to in paragraph 1.5(a) above as if it had been given afresh at such time and shall not be extinguished by such purchase.
A reference in this section headed "Effect of Tender" to a Shareholder includes a reference to the person or persons executing the Tender Form and/or executing the TTE Instructions (as appropriate), and in the event of more than one person executing a Tender Form and/or executing the TTE Instructions (as appropriate), the provisions of this paragraph will apply to them jointly and severally.
1.6 Purchase of Shares and Settlement
Unless the Reverse Auction Tender Offer is terminated or is void, the outcome of the Reverse Auction Tender Offer and (if applicable) the extent to which tenders will be scaled down will be announced by no later than 5.00 p.m. on 20 July 2010.
The payment of any consideration for Shares pursuant to the Reverse Auction Tender Offer will be made only after the appropriate TTE Instruction has settled or (as may be the case) timely receipt by the Receiving Agent of share certificate(s) and/or other documents of title, a properly completed and duly executed Tender Form and any other documents required by the Tender Form. Delivery of cash for the Shares to be purchased by the Company pursuant to the Reverse Auction Tender Offer will be made by the Receiving Agent. The Receiving Agent will act as agent for tendering Shareholders for the purpose of receiving the cash and transmitting such cash to tendering Shareholders. Under no circumstances will interest be paid on the cash to be paid by the Company notwithstanding any delay in making such payment.
If any tendered Shares are not purchased by the Company pursuant to the terms of the Reverse Auction Tender Offer, in the case of Shares held in certificated form relevant share certificates evidencing any such Shares and/or other documents of title will be returned or sent as promptly as practicable without expense to, but at the risk of, the Shareholders tendering their Shares. In the case of uncertificated Shares, Shares transferred to escrow will be released.
Settlement of the consideration to which any Eligible Shareholder is entitled pursuant to valid tenders accepted by the Company will be made as follows:
(a) Shares in certificated form
Where an accepted tender relates to Shares held by Shareholders in certificated form, cheques for the consideration are expected to be despatched (at the recipient's risk) within 30 Business Days after the publication of the Net Asset Value per Share as at 30 June 2010 by the Receiving Agent (on behalf of the Company) by first class post.
(b) Shares in uncertificated form
Where an accepted tender relates to Shares held by Shareholders in uncertificated form, settlement is expected to be made (at the recipient's risk) within 30 Business Days after the publication of the Net Asset Value per Share as at 30 June 2010. PART III UK TAX CONSIDERATIONS
The following summary of the tax treatment in the United Kingdom is intended as a general guide only. It is based on certain aspects of current UK law and HM Revenue & Customs published practice as at the date of this document (each of which are subject to change, potentially with retrospective effect) and does not constitute tax advice. The summary relates only to Shareholders who are resident in the United Kingdom for tax purposes (save as expressly provided otherwise), who beneficially own their Shares and who hold their Shares as investments. It may not be applicable to certain Shareholders, including insurance companies, dealers in securities and Shareholders who are not beneficial owners of the relevant Shares, such as trustees.
Any Shareholder who is in any doubt as to his or her tax position or who is subject to tax in a jurisdiction other than the United Kingdom is strongly recommended to consult an appropriate professional adviser.
Disposal of Shares
Subject to the comments below, the sale of Shares to the Company under the Reverse Auction Tender Offer should be treated for UK tax purposes as a sale on market in the ordinary way to a third party and should constitute a disposal for UK tax on chargeable gains purposes at a price per Share equal to the applicable Strike Price. Whether a loss or a gain arises for a particular Shareholder will depend on the price at which that Shareholder originally acquired the Shares and exemptions and reliefs (such as the annual exemption, which presently exempts the first (pound)10,100 of gain from tax) may be available for certain Shareholders.
Offshore fund rules
The UK tax treatment of any disposal of the Shares is subject to the application of the UK offshore fund rules. These rules were amended with effect from 1 December 2009 and include, amongst other things, a new definition of "offshore fund". If the Company were to constitute an offshore fund under the UK tax rules, gains arising to a Shareholder on disposal of the Shares may be subject to tax as income and not as capital gain.
Shareholders who acquired their Shares prior to 1 December 2009 should not be affected by the new offshore fund rules. The new rules are potentially relevant only to Shareholders who acquired their Shares on or after that date. Under both the old and the new offshore fund rules (as relevant) the Reverse Auction Tender Offer should not of itself result in the Company being treated as an "offshore fund" under the applicable rules, and as such any disposal should be treated as falling outside of these rules. Shareholders for whom the new offshore fund rules are relevant should note that HM Revenue & Customs have not yet published final guidance on the new rules.
Stamp Duty and stamp duty reserve tax ("SDRT")
There should be no stamp duty or SDRT payable on the purchase by the Company of Shares under the Reverse Auction Tender Offer. In the event that any such duty is or becomes payable the cost will be borne by the Company.
PART IV ADDITIONAL INFORMATION1. Registered Office
The Company's registered office is Forum House, Grenville Street, Jersey, Channel Islands JE1 0BR.
2. Directors
The names of the Directors of the Company and their respective positions are asfollows:Name Position(s)Colin Maltby ChairmanFrank Le Feuvre Non-Executive and non-independent DirectorJonathan Ruck Keene Non-Executive and non-independent DirectorJohn Siska Non-Executive DirectorPhilip Smith Non-Executive Director3. Directors and other interests3.1 As at 29 April 2010 (being the latest practicable date prior to the publication of this document), the interests of the Directors and the interests of persons connected with such Directors in the voting rights of the Company and the existence of which is known or could with reasonable diligence be ascertained by that Director were, and immediately following the Reverse Auction Tender Offer (assuming the maximum number of Shares are purchased by the Company pursuant to the Reverse Auction Tender Offer and, none of the Directors sell any of their Shares) will be as follows: % after Percentage of Reverse AuctionDirector Number of Shares voting rights Tender OfferColin Maltby 4,366 Euro Shares 0.027 0.030Frank Le Feuvre - - -Jonathan Ruck Keene 5,000 Sterling Shares 0.036 0.039John Siska - - -Philip Smith - - -
3.2. Save as disclosed above, no Director nor, so far as is known to the
relevant Director, any person connected with a Director has any interest in
the share capital of the Company.
4. Significant Shareholdings
As at 23 April 2010, the Company had received notification in accordance with the FSA's Disclosure and Transparency Rule 5.1.2 R of the following interests in 3% or more of the voting rights attaching to the Company's issued share capital.
Total Number of Shares voting US Dollar Euro Sterling rights %BlackRock Inc.* - - 1,989,974 14.2BUPA Insurance Limited - - 1,556,438 11.1Investec Asset Management Limited 1,559,807 - 809,250 12.8Western Provident Association - - 918,366 6.6Deutsche Bank AG - - 877,590 6.3Rensburg Sheppards Investment Management Limited 92,521 7,875 798,108 6.2Midas Capital plc - - 619,924 4.4
* Including 1,572,621 Shares held by L&G Target Return Trust representing
11.3% of the total voting rights.
No other shareholder had notified an interest of 3% or more in the Company'sShares as at 23 April 2010. PART V RISK FACTORS
Investors are referred to the risks set out below. Only those risks which are material and currently known to the Company have been disclosed. No assurance can be given that Shareholders will realise a profit or will avoid a loss on their investment. Investment in the Company should be regarded as long-term in nature and is suitable only for persons who can bear the economic risk of a substantial or entire loss of their investment and who can accept that there may be limited liquidity in the Shares. The information below does not purport to be an exhaustive list or summary of the risks which the Company may encounter and is not set out in any particular order of priority. Additional risks and uncertainties not currently known to the Company, or that the Company deems to be immaterial, may also have an adverse effect on the Company's business. Investors should review this document carefully and in its entirety and consult with their professional advisers before making an investment decision in relation to the Shares.
Risks relating to the Reverse Auction Tender Offer
Shareholders should have regard to the following risk factors (which are not exhaustive) when considering whether or not to tender their Shares under the Reverse Auction Tender Offer:
o Portfolio realisations necessary to fund the Reverse Auction Tender offer may not be received in a timely manner due to market conditions or other circumstances and accordingly the settlement of the Reverse Auction Tender Offer may be delayed.o The discount to Net Asset Value at which Shares currently trade may not reduce as a result of the Reverse Auction Tender Offer (or otherwise) and may increase. The lower number of Shares in issue following completion of the Reverse Auction Tender Offer may reduce secondary market liquidity in the Shares which could, accordingly, adversely affect a Shareholder's ability to sell his Shares in the market.o The Net Asset Value performance of the Company may not improve with the result that the Net Asset Value attributable to the Shares may decline.o The issued share capital of the Company will be reduced as a result of the Reverse Auction Tender Offer to the extent that Shares are tendered thereunder. Consequently, the fixed costs of the Company will be spread over fewer Shares.o Shares in uncertificated form for which TTE Instructions are made will be transferred to escrow in CREST. It will not, therefore, be possible to access or otherwise deal in such Shares and such Shares will be held in escrow until the close of the Reverse Auction Tender Offer. Certificated Shares for which a Tender Form and relevant Share certificate(s) have been submitted will be retained by the Company's Receiving Agent, and so it will not be possible to access or otherwise deal in such Shares until the close of the Reverse Auction Tender Offer.o A tender pursuant to the Reverse Auction Tender Offer, once served on the Company or its agents, may not be withdrawn without the consent of the Directors.o Securities laws in certain jurisdictions, in particular the Restricted Territories, may prevent certain Shareholders, in particular, Excluded Overseas Shareholders, from participating in the Reverse Auction Tender Offer. For more information, please refer to the section entitled "Overseas Shareholders" in Part II of this document. DEFINITIONSIn this document and the Tender Form the following definitions apply unless thecontext requires otherwise:"Articles of Association" or the articles of association of the Company as"Articles" at the date of this document"Australia" the Commonwealth of Australia, its states, territories and possessions"Available Shares" up to 7.5 per cent. of each of the Sterling, Euro and US Dollar denominated Shares in issue on the date of this document, being up to 801,045 Sterling Shares, 164,178 Euro Shares and 165,505 US Dollar Shares"Board" or "Directors" the board of directors of the Company, whose names are set out in paragraph 2 of Part IV of this document"business day" a day (other than a Saturday or Sunday or public holiday) on which banks are generally open for business in London and Jersey"Canada" Canada, its provinces and territories and all areas subject to its jurisdiction and any political sub-division thereof"certificated" or not in uncertificated form"in certificated form""Closing Date" 3.00 p.m. on Monday 19 June 2010"Companies Law" the Companies (Jersey) Law 1991 as amended, extended or replaced from time to time"Company" BlackRock Absolute Return Strategies Ltd"Computershare" Computershare Investor Services PLC, The Pavilions, Bridgwater Road, Bristol BS13 8AE"CREST" the relevant system (as defined in the CREST Regulations) in respect of which Euroclear is the Operator (as defined in the CREST Regulations) in accordance with which securities may be held and transferred in uncertificated form"CREST member" a person who has been admitted by Euroclear as a system member (as defined in the CREST Regulations)"CREST participant" a person who is, in relation to CREST, a system-participant (as defined in the CREST Regulations)"CREST Regulations" the Jersey Regulations and the UK Regulations"CREST sponsor" a CREST participant admitted to CREST as a CREST sponsor being a sponsoring system participant (as defined in the CREST Regulations)"CREST sponsored member" a CREST member admitted to CREST as a sponsored member"Disclosure and Transparency the disclosure and transparency rules made byRules" the FSA under Part VI of FSMA"Discount Level" the level at which Eligible Shareholders of each Share class will be able to tender for purchase some or all of their Shares at their chosen level of discount to the NAV at the Reverse Auction Tender Offer NAV Calculation Date"Eligible Shareholders" Shareholders resident in, or citizens of, a jurisdiction outside the Restricted Territories on the Register at the Record Date"Euro" or "(euro)" refers to the lawful single currency introduced at the start of the third stage of the Economic and Monetary Union, pursuant to the Treaty establishing the European Economic Community, as amended by the Treaty on the European Union"Euro Shares" Shares of the Company denominated in Euro"Euroclear" Euroclear UK & Ireland Limited"Excluded Overseas Shareholders who are citizens or nationals of,Shareholders" or resident in, any of the Restricted Territories"Extraordinary General the extraordinary general meeting of theMeeting" or "EGM" Company to be held at 3.00 p.m. on Tuesday 29 June 2010, or any adjournment thereof, notice of which is set out on pages 29 to 32 of this document"Form(s) of Proxy" the form(s) of proxy for use at the EGM"FSA" the UK Financial Services Authority"FSMA" the UK Financial Services and Markets Act 2000, as amended"Investment Manager" BlackRock Alternative Advisors, a business division of BlackRock Financial Management, Inc."Jersey Regulations" the Companies (Uncertificated Securities) (Jersey) Order 1999"London Stock Exchange" London Stock Exchange plc"Minimum Discount Level" for each Share class, the minimum discount level to Net Asset Value per Share on the Reverse Auction Tender Offer NAV Calculation Date at which Shares offered for purchase may be accepted, being 9 per cent."NAV" or "Net Asset Value" the net asset value of the Company being the value of the assets of the Company, less its liabilities, determined in accordance with the accounting principles adopted by the Company from time to time or, as the context requires, the net asset value per Share calculated in accordance with the Company's accounting principles"Overseas Shareholders" Shareholders who are citizens or nationals of, or resident in, jurisdictions outside the United Kingdom"participant ID" the identification code or membership number used in CREST to identify a particular CREST Member or other CREST participant"Portfolio" the Company's portfolio of investments"Receiving Agent" Computershare Investor Services PLC, Corporate Actions Projects, Bristol, BS13 8AE"Record Date" 5.00 p.m. on Tuesday 16 March 2010"Register" the register of members of the Company"Registrars" Computershare Investor Services (Jersey) Limited, Ordnance House, 31 Pier Road, St Helier, Jersey, JE4 8PW"Resolutions" the special resolutions to be proposed at the EGM"Restricted Territories" United States, Canada, Australia and Japan
"Reverse Auction Tender Offer" the invitation by the Company to Eligible
Shareholders to tender Shares for purchase by the Company on the terms and subject to the conditions set out in this document and the Tender Form"Reverse Auction Tender Offer 30 June 2010NAV Calculation Date""RIS" a regulatory information service that is approved by the FSA as meeting the primary information provider criteria and that is on the list of regulatory information services maintained by the FSA"Shareholders" holders of Shares"Shares" the Sterling Shares, the Euro Shares and/or the US Dollar Shares as the context may require"Sterling Shares" Shares of the Company denominated in Sterling"Strike Discount" the Discount Level which will be used to determine the Strike Price for a particular Share class"Strike Price" for each Share class, the prices at which Shares will be purchased pursuant to the Reverse Auction Tender Offer, calculated as set out in this document less the pro rata amount of the costs and expenses of the Reverse Auction Tender Offer"Tender Form" the personalised tender form accompanying this document for use in connection with the Reverse Auction Tender Offer by Eligible Shareholders"TTE Instruction" transfer to escrow instruction"UK Regulations" the Uncertificated Securities Regulations 2001 (SI No. 2001/3755)"United Kingdom" or "UK" the United Kingdom of Great Britain and Northern Ireland"United States" or "US" the United States of America, its territories and possessions, any state of the United States of America, the District of Columbia, and all other areas subject to its jurisdiction"US$" or "US Dollars" the United States Dollar, the lawful currency for the time being of the United States and references to "cents" shall be construed accordingly"US Dollar Shares" Shares of the Company denominated in US Dollars"US Investment Company Act" the US Investment Company Act of 1940, as amended"US Person" as defined in Regulation S of the US Securities Act"US Securities Act" the US Securities Act of 1933, as amended
"(pound)" or "Pounds Sterling" pounds Sterling, the lawful currency for the
time of the UK and references to "pence" and "p" shall be construed accordingly NOTICE OF EXTRAORDINARY GENERAL MEETING BLACKROCK ABSOLUTE RETURN STRATEGIES LTD (the "Company")
NOTICE IS HEREBY GIVEN that an extraordinary general meeting of the Company will be held at 3.00 p.m. on Tuesday 29 June 2010 at the offices of Blackrock (Channel Islands) Limited, Forum House, Grenville Street, St Helier, Jersey, JE1 0BR (the "EGM") to consider and, if thought fit, pass Resolutions 1 and 2 as special resolutions:
SPECIAL RESOLUTIONSTHAT:1. Pursuant to Article 57 of the Companies (Jersey) Law 1991 as amended, the Company be and is hereby authorised to make market purchases of its own Shares, provided that: (a) the maximum number of Shares hereby authorised to be purchased is: - 801,045 Sterling denominated shares of no par value; - 164,178 Euro denominated shares of no par value; - 165,505 US Dollar denominated shares of no par value; or such other number of Shares that is equal to 7.5 per cent. of the issued share capital of each of the share classes of the Company on the date hereof; (b) the minimum price which may be paid: - for a Sterling denominated Share of no par value shall be (pound)0.01; - for a Euro denominated Share of no par value shall be (euro)0.01; - for a US Dollar denominated Share of no par value shall be $0.01; (c) the maximum price which may be paid for a Share shall be such price that is equal to 91 per cent. of the published net asset value per Share of the relevant share class of the Company as at 30 June 2010; and (d) the authority hereby conferred shall expire on 28 December 2011. All Shares purchased pursuant to the above authority be held as treasury shares pursuant to Article 58A of the Companies (Jersey) Law 1991 as amended.2. Subject to and conditional upon the approval of Resolution 1, and pursuant to Article 57 of the Companies (Jersey) Law 1991 as amended, the Company be and is hereby authorised to make market purchases of its own Shares, provided that: (a) the maximum number of Shares hereby authorised to be purchased is such number of Shares that is equal to 7.5 per cent. of the issued share capital of each of the share classes of the Company on a date to be determined by the Directors but not being later than 28 December 2011; (b) the minimum price which may be paid: - for a Sterling denominated Share of no par value shall be (pound)0.01; - for a Euro denominated Share of no par value shall be (euro)0.01; - for a US Dollar denominated Share of no par value shall be $0.01; (c) the maximum price which may be paid for a Share shall be such price that is equal to 91 per cent. of the published net asset value per Share of the relevant share class of the Company on a date to be determined by the Directors but not being later than 28 December 2011; and (d) the authority hereby conferred shall expire on 28 December 2011. All Shares purchased pursuant to the above authority be held as treasury shares pursuant to Article 58A of the Companies (Jersey) Law 1991 as amended.By Order of the BoardBlackRock (Channel Islands) LimitedRegistered Office:Forum HouseGrenville StreetSt HelierJerseyChannel IslandsJE1 0BR30 April 2010Notes:1. The Company, pursuant to the Companies (Uncertificated Securities) (Jersey) Order 1999, specifies that only those persons entered on the register of members of the Company as at 6.00 p.m. on 27 June 2010 shall be entitled to attend or vote at the meeting in respect of the number of shares registered in their name at that time. Changes to entries on the register of members after 6.00 p.m. on 27 June 2010 shall be disregarded in determining the rights of any person to attend or vote at the meeting. If the meeting is adjourned to a time not more than 48 hours after the specified time applicable to the original meeting, that time will also apply for the purpose of determining the entitlement of members to attend and vote (and for the purposes of determining the number of votes they may cast) at the adjourned meeting. If however, the meeting is adjourned for a longer period then, to be so entitled, members must be entered on the Company's register of members at 6.00 p.m. on the day two days prior to the adjourned meeting, or, if the Company gives notice of the adjourned meeting, at the time specified in that notice.2. The following documents will be available for inspection at the Company's registered office, Forum House, Grenville Street, St Helier, Jersey, JE1 0BR, during normal business hours on weekdays (Saturdays and public holidays excluded) and at the place of the Extraordinary General Meeting from 9.00 a.m. on the day of the meeting until its conclusion: (i) this Circular; and (ii) the Company's Memorandum and Articles of Association.3. A member entitled to attend and vote at the meeting may appoint a proxy or proxies to attend and, on a poll, to vote in his/her place. A proxy need not be a member of the Company. If a shareholder wants their proxy to speak on their behalf, they must appoint someone other than the Chairman as their proxy. A shareholder may appoint more than one proxy, provided that the total number of such proxies shall not exceed the total number of shares carrying an entitlement to attend such meeting held by such member. The appointment of a proxy will not preclude members entitled to attend and vote at the meeting (or at any adjournment(s) of the meeting) from doing so in person if they so wish.4. A vote withheld is not a vote in law, which means that the vote will not be counted in the calculation of votes for or against the resolution. If in your proxy form you either select the "Vote withheld" option or if no voting indication is given, your proxy will vote or abstain from voting at his or her discretion. Your proxy will vote (or abstain from voting) as he or she thinks fit in relation to any other matter which is put before the meeting.5. Under Jersey law, corporations may only appoint one corporate representative. Corporations wishing to allocate their votes to more than one person should use the proxy arrangements.6. Any person to whom this notice is sent who is a person nominated to enjoy information rights (a "Nominated Person") may, under an agreement between him/her and the shareholder by whom he/she was nominated, have a right to be appointed (or to have someone else appointed) as a proxy for the meeting. If a Nominated Person has no such proxy appointment right or does not wish to exercise it, he/she may, under any such agreement, have a right to give instructions to the shareholder as to the exercise of voting rights.7. The statement of the rights of shareholders in relation to the appointment of proxies in paragraph 3 above does not apply to Nominated Persons. The rights described in that paragraph can only be exercised by shareholders of the Company.8. To be valid, an appointment of proxy must be returned by sending a proxy form (together, if appropriate, with the power of attorney or other written authority under which it is signed or a certified copy of such power or authority) to the office of the Company's registrars, Computershare Investor Services (Jersey) Limited, Ordnance House, 31 Pier Road, St. Helier, Jersey JE4 8PW. CREST members of the Sterling denominated Shares only, may also utilise the CREST electronic proxy appointment service. In each case the appointment of proxy (together with any relevant power/authority) must be received (or, in the case of the appointment of a proxy through CREST, retrieved by enquiry to CREST in the manner prescribed by CREST) by the Company's registrars not later than 48 hours before the time appointed for holding the meeting.9. CREST members who wish to appoint a proxy or proxies through the CREST electronic proxy appointment service in respect of Sterling denominated Shares only, may do so for the meeting and any adjournment(s) of the meeting by using the procedures described in the CREST Manual. CREST personal members or other CREST sponsored members, and those CREST members who have appointed a voting service provider(s), should refer to their CREST sponsor or voting service provider(s), who will be able to take the appropriate action on their behalf. In order for a proxy appointment or instruction made using the CREST service to be valid, the appropriate CREST message (a "CREST Proxy Instruction") in respect of Sterling denominated Shares only, must be properly authenticated in accordance with Euroclear's specifications and must contain the information required for such instructions, as described in the CREST Manual. The message, regardless of whether it constitutes the appointment of a proxy or an amendment to the instruction given to a previously appointed proxy, must, in order to be valid, be transmitted so as to be received by the issuer's agent (ID 3RA50) by the latest time(s) for receipt of proxy appointments specified in note 8 above. For this purpose, the time of receipt will be taken to be the time (as determined by the timestamp applied to the message by the CREST Applications Host) from which the issuer's agent is able to retrieve the message by enquiry to CREST in the manner prescribed by CREST. After this time, any change of instructions to proxies appointed through CREST should be communicated to the appointee by other means. CREST members and, where applicable, their CREST sponsors or voting service providers should note that Euroclear does not make available special procedures in CREST for any particular messages. Normal system timings and limitations will therefore apply in relation to the input of CREST Proxy Instructions. It is the responsibility of the CREST member concerned to take (or, if the CREST member is a CREST personal member or sponsored member or has appointed a voting service provider(s), to procure that his/her CREST sponsor or voting service provider(s) take(s)) such action as shall be necessary to ensure that a message is transmitted by means of the CREST system by any particular time. In this connection, CREST members and, where applicable, their CREST sponsors or voting service providers are referred, in particular, to those sections of the CREST Manual concerning practical limitations of the CREST system and timings. The Company may treat as invalid a CREST Proxy Instruction in the circumstances set out in Article 34 of the Companies (Uncertificated Securities) (Jersey) Order 1999.
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Smo Gold