CIFU.L Regulatory News (CIFU)

Carador Income Fund PLC

Shareholder Circular and Notice of EGM

Carador Income Fund PLC (the "Company") announces that it is today posting a circular to its Shareholders (the "Circular"), which includes a notice to convene an extraordinary general meeting of the Company to be held at 4pm (Irish time) on 26 June 2013 at 78 Sir John Rogerson's Quay, Dublin 2, Ireland (the "EGM").

The Company has delivered strong shareholder returns with an annualised NAV total return of 26.54* per cent. from the launch of the U.S. Dollar share class to 30 April 2013. The CLO market has evolved significantly over the last 12 months and much of the strong returns over the last three years have been generated from significant cashflows and a re-rating of CLO Mezzanine and Income Notes. The Company believes that the opportunity to deploy significant capital in the secondary CLO market at attractive returns will diminish over the next few years. In contrast, the primary CLO market recovered dramatically in 2012 and primary CLO Income Notes may now offer higher risk-adjusted internal rates of return than those currently available in the secondary market ("risk-adjusted" in this context means adjusting for potential losses from defaults). As a result, the Company intends to take advantage of the opportunity to invest in primary CLO Income Note transactions which, although permitted under the current investment policy, needs to be considered alongside some of the structural features of the Company.

Therefore, following a consultation process with its major Shareholders, the Company has developed proposals to, inter alia:

·; increase the Company's exposure to primary CLO income note transactions compared with the current concentration on secondary CLO positions;

·; replace the 2017 continuation vote with a redemption opportunity, at the Directors' discretion, for investors in 2017 (and every five years thereafter) if the Shares have traded at an average discount to NAV in excess of 5 per cent. over the 12 month period prior to 30 April in the relevant year;

·; amend the Articles to replace the winding-up vote to take place in 2021 with a continuation vote to be held in 2022 (and every 10 years thereafter);

·; amend the Company's distribution policy such that the Company not be required to pay out all net income each year and to use this flexibility for the purposes of making more consistent quarterly dividend payments;

·; permit the issue of 500 million Shares on a non-pre-emptive basis; and

·; amend the Investment Manager's performance fee hurdle. With effect from 1 January 2014, the Hurdle Rate, which is currently 12-month U.S. Dollar Libor, (plus 2 per cent) will be changed to the higher of 12-month U.S. Dollar Libor and 4 per cent. (plus 2 per cent).

The Circular sets out the background to the Proposals and the full details of the proposed changes, together with the resolutions to be proposed at the EGM.

To view the full contents of the Circular, please paste the following URL into the address bar of your browser:

Defined terms used in this announcement shall have the same meaning as ascribed in the Circular unless the context requires otherwise.

For further information, please contact: