CIFU.L Regulatory News (CIFU)

RNS Announcement

Carador Income Fund plc

18 October 2012

Conversion of C Shares - Class C Calculation Time

NOT FOR RELEASE, DISTRIBUTION OR PUBLICATION, DIRECTLY OR INDIRECTLY, TO U.S. PERSONS OR INTO OR IN THE UNITED STATES, AUSTRALIA, CANADA OR JAPAN.

Carador Income Fund PLC ("Carador" or the "Company") announces that, in accordance with the terms described in its prospectus dated 16 July 2012 (the "Prospectus"), the Investment Manager has notified the Board of Directors that as at 10 October 2012, 84.2% of the assets attributable to the U.S. Dollar C Shares had been invested or committed to be invested in a portfolio consistent with the Company's investment policy. As a result, the Board has determined that the Class C Calculation Time (for the purposes of calculating the basis upon which the Company's U.S. Dollar C Shares will convert into U.S. Dollar Shares) will be the close of business on 31 October 2012.

The dividends for the period up to the Class C Calculation Time attributable to existing U.S. Dollar Shareholders and U.S. Dollar C Shareholders will be excluded from the calculation of the Net Asset Value for the purpose of determining the conversion ratio. U.S. Dollar C Shares (on the basis that they are converted into U.S. Dollar Shares at the ratio determined at the Class C Calculation Time) will rank equally for dividends with U.S. Dollar Shares immediately following the Class C Calculation Time. The dividends for the period to 31 October 2012 will be distributed at a date and amount to be notified by an RIS announcement, expected to be mid-November 2012.

A further announcement regarding the conversion ratio, Class C Conversion Time and the number of new U.S. Dollar Shares to be issued on Conversion is expected to be made in mid-November 2012.

The U.S. Dollar C Share portfolio, including cash, invested or committed to be invested, as at 10 October 2012 consisted of:

·; 12 securities from 8 different loan managers;

·; Securities with a total notional amount of $118.0m for total consideration of $103.1m;

§ 47.3% of CLO Income Note tranches from secondary CLOs. The most recent annualised cash on cash payments on these Income Notes ranged from 17.1% to 34.9% (weighted average 22.1%) based on the nominal amount, or 21.9% to 30.5% (weighted average 23.7%) based on the cost price at which Carador acquired the Income Notes;

·; 36.9% of CLO mezzanine tranches (of which 91% are original BB ratings and 9% original BBB ratings); and

·; 15.8% cash.

Capitalised terms in this announcement shall have the same meanings as in the Prospectus unless otherwise stated.

For further information please contact:

Important Information

Any reference herein to future returns or distributions is a target and not a forecast and there can be no guarantee or assurance that it will be achieved. The actual principal and income in any particular case will be determined by the cash flows received.

 This document is issued and has been approved for the purposes of Section 21 Financial Services and Market Act 2000 ("FSMA") by the Manager, which is authorised and regulated by the Financial Services Authority in the United Kingdom. It does not constitute an invitation and should not be taken as an inducement to engage in any investment activity and is for the purpose of providing information about the Manager and certain Manager's Affiliates only. It may not be relied upon and should not be used for the purpose of making any investment decision. This document and the information contained herein is not for release, publication or distribution (directly or indirectly) in or into the United States, Canada, Australia or Japan or to any "US person" as defined in Regulation S under the United States Securities Act of 1933, as amended (the "Securities Act") or into any other jurisdiction where applicable laws prohibit its release, distribution or publication. It does not constitute or contain an offer of, or the solicitation of an offer to buy or subscribe for, securities for sale anywhere in the world, including in or into the United States, Canada, Australia or Japan. This document is being furnished to you solely for your information and no recipient may forward, reproduce, distribute, or make available in whole or in part, this document (directly or indirectly) to any other person. The distribution of this document in certain jurisdictions may be restricted by law and recipients of this document should inform themselves about and observe any such restrictions and other applicable legal requirements in their jurisdictions. Accordingly, recipients represent that they are able to receive this document without contravention of any applicable legal or regulatory restrictions in the jurisdiction in which they reside or conduct business. By accepting this document, you agree to be bound by the foregoing limitations.

This document has been prepared by Carador Income Fund PLC ("Carador") and is the sole responsibility of Carador. No liability whatsoever (whether in negligence or otherwise) arising directly or indirectly from the use of this document is accepted and no representation, warranty or undertaking, express or implied, is or will be made by Carador, GSO Capital Partners International LLP ("GSOCPI") or any of their respective directors, officers, employees, advisers, representatives or other agents ("Agents") for any information or any of the opinions contained herein or for any errors, omissions or misstatements. None of GSOCPI nor any of its respective Agents makes or has been authorised to make any representation or warranties (express or implied) in relation to Carador or as to the truth, accuracy or completeness of this document, or any other written or oral statement provided. In particular, no representation or warranty is given as to the achievement or reasonableness of, and no reliance should be placed on any projections, targets, estimates or forecasts contained in this document and nothing in this document is or should be relied on as a promise or representation as to the future.

Carador has not been and will not be registered under the U.S. Investment Company Act of 1940, as amended (the "Investment Company Act") and investors will not be entitled to the benefits of that Act. The securities described in this document have not been and will not be registered under the Securities Act, or the laws of any state of the United States. Consequently, such securities may not be offered, sold or otherwise transferred within the United States or to or for the account or benefit of U.S. persons (as such term is defined in Regulation S under the Securities Act) except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act, applicable state laws and under circumstances which will not require Carador to register under the Investment Company Act. No public offering of the securities is being made in the United States. If you are in the United States and are not either (a) a "qualified institutional buyer" (as defined in Rule 144a under the Securities Act) who is also a "qualified purchaser" (as defined in Section 2(a)(51) of the Investment Company Act) for purposes of Section 3(c)(7) of the Investment Company Act; or (b) an "accredited investor" (as defined in Rule 501 of the Securities Act) who is either a qualified purchaser or an eligible Investment Company Act investor, you should not open this document and should destroy it.