Trading Update & Change of Investment Manager

 
TIDMAQT3 
 
On  29 March 2011, the Board of Directors met with Acuity Capital Management and 
Foresight Group CI Limited ("Foresight") to review the portfolio of the Company. 
As  a result of those discussions and  the potential funding requirements of the 
portfolio  companies, the Board announces that  the Net Asset Value per Ordinary 
Share  of the  Company will  be substantially lower  than the last published Net 
Asset Value. 
 
The  Board is pleased to announce that, with effect from 1 April 2011, Foresight 
Group  CI Limited ("Foresight") has been  appointed as the investment manager in 
place  of Acuity Capital  Management Limited ("Acuity").   In addition Foresight 
Fund  Managers Limited has been  appointed as the company  secretary in place of 
Acuity. 
Bernard Fairman, Chairman of Foresight Group, commented: "We are delighted that, 
following   a  competitive  process  involving  several  venture  capital  trust 
managers,  the Board of Acuity 3 VCT plc has awarded Foresight Group the mandate 
to  provide  ongoing  investment  management  services  to  the Company. We look 
forward to working closely with the Board and the underlying portfolio companies 
with  a  view  to  delivering  enhanced  shareholder  value. As a result of this 
transaction, Foresight Group has consolidated its position as one of the largest 
managers  of  VCT  funds  with  approximately   GBP250  million  of VCT funds under 
management". 
 
The  terms  of  the  investment  management  agreement  with Foresight (the "New 
Management  Agreement")  are  substantially  similar  to  the Company's previous 
arrangements  with Acuity (the "Previous  Management Agreement").  Foresight has 
agreed to waive its management and administration fees for a period of 12 months 
from  7 March 2011 and thereafter will receive an annual management fee of 2.5 % 
of  the  net  asset  value  of  the  Company payable quarterly based on the last 
announced  net  asset  value  of  the  Company.  Additionally it will receive an 
administration  fee of  GBP69,937 per annum, which will rise in line with RPI.  The 
New Management Agreement has an initial term of at least 24 months from the date 
of appointment and can be terminated thereafter by either party on not less than 
12 months'   notice.  The  Board  and  Foresight  Group  have  agreed  that  new 
performance incentive arrangements will not be proposed to shareholders until at 
least 12 months has passed following Foresight's appointment. 
 
Under  the Previous  Management Agreement,  the Board  was required  to give one 
year's  notice to Acuity to  terminate the agreement.  The  Board entered into a 
termination  agreement with Acuity on 1 April 2011 (the "Termination Agreement") 
pursuant  to  which  the  Company  has  agreed  to pay Acuity  GBP280,500 in phased 
payments  and  GBP11,656 per  quarter for three  quarters for its  work to ensure a 
smooth  handover to  Foresight Group  and has  agreed to  redeem the   GBP51,150 of 
outstanding  loan notes  issued to  Acuity's employees.   Acuity and the Company 
have  agreed  that  the  Termination  Agreement  is  in settlement of all claims 
against  each  other.  The  Company  has  also  agreed  to  keep  Acuity and its 
directors,   employees   and   agents  (together  "Indemnified  Persons")  fully 
indemnified  against  all  or  any  actions,  proceedings,  claims,  demands and 
liabilities  whatsoever arising directly  or indirectly out  of or in connection 
with  the performance of Acuity's duties under the Previous Management Agreement 
(subject  to  certain  exceptions)  and  in  respect of the Company's failure to 
comply  with the terms of that agreement. Pursuant to the agreement, the Company 
has  agreed to procure a change  of its name so as  to cease using Acuity in its 
name on or before 30 September 2011. 
 
The  Board also announces that Nicholas Ross was not put up for re-election as a 
director of the Company at the AGM of 25 March 2011 and accordingly has resigned 
from the board with effect from the date of the AGM. 
 
Commenting  upon the proposed change of  Manager, Stuart Stradling, Chairman of 
Acuity  VCT 3, said, 'Following an  intensive selection process, the Independent 
Directors reached the unanimous conclusion that shareholders' interests would be 
best  served by appointing Foresight  Group  to manage Acuity  VCT 3 and we look 
forward  to working  closely with  them. I  would like  to thank  Acuity Capital 
Management  for  their  work  and  facilitating  an  orderly  transition  of the 
portfolio to ensure that shareholders' interests are best protected." 
 
 
 
 
 
 
 
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Source: Acuity VCT 3 PLC via Thomson Reuters ONE 
 
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