FAQs re proposed Scheme of Arrangement for Link Fund Solutions Limited

Introduction

Please note that the information provided below in the FAQs is a brief summary of the very detailed documentation that is available about the proposed Scheme of Arrangement (“Scheme”) regarding Link Fund Solutions Limited (“Link”) and should not be taken as an alternative to reading that detailed documentation in full.

The main documents relating to the Scheme are available at:

https://lfwoodfordfundscheme.com/documents/

What is set out below is aimed at assisting members of the RGL Group better understand what the Scheme involves, and the potential consequences of voting for or against it, including the impact on legal claims against Link and the losses suffered by investors as a result of Link’s conduct as the Authorised Corporate Director (“ACD”) of the Woodford Equity Income Fund (“WEIF”).

It is important to state from the off that whether or not the Scheme is ultimately approved, investors will still be able to bring legal claims in Court against Hargreaves Lansdown.  The RGL Group remains the only group that intends to pursue such claims, and will do so on a fully funded and insured basis, such that members of the RGL Group will not have to pay anything unless and until the legal claims are successful.

You may well have further queries about the Scheme having read the FAQs.  There is a Scheme related dedicated telephone helpline provided by Link (as it is required to do) on +44 20 3991 0224 (local rates apply), which you should use if required.  The RGL team may be able to assist you, but the helpline or the Investor Advocate (see immediately below) should be your first port of call.  Please note that you do not have to send us any of the information you may have received from Link.

You can raise any general questions free of charge with Joe Bannister, the Investor Advocate, who has been appointed to represent investors in respect of the Scheme.

Mr. Bannister is an experienced lawyer and independent of Link and its parent company.  He does not work for, and has never worked for, any member of the Link Group. The Investor Advocate has prepared an initial report on the feedback he has received on the Scheme from Scheme Creditors which is available at https://lfwoodfordfundscheme.com/documents. Mr. Bannister’s contact details are included below:

As regards whether to vote for or against the Scheme, ultimately this is a decision to be taken by each investor.

FAQs

[A]        What is a Scheme of Arrangement and why is one proposed for Link?

[B]        Am I eligible to vote?

[C]        By when do I need to Vote?

[D]       How do I Vote?

[E]        What is the Scheme Meeting on 13 December 2023?

[F]        What is the FCA’s position in relation to the Scheme?

[G]       Are there reasons to question the FCA’s position?

[H]       What is the FSCS?

[I]         How much would I receive if the Scheme is approved?

[J]         What happens if the Scheme is approved?

[K]        What happens if the Scheme is not approved?

[L]        Why might I consider voting for the Scheme?

[M]       Why might I consider voting against the Scheme?

[N]       Will the Scheme impact payments already received from the winding-up of the WEIF?

[O]       What is RGL’s position in relation to the Scheme?

[P]        What about claims against Hargreaves Lansdown?

[Q]       How much will RGL deduct from any Scheme compensation?

[R]        Further Reading

[A]        What is a Scheme of Arrangement and why is one proposed for Link?

1. Link has many tens of thousands of potential creditors, i.e. investors with legal claims against it arising from Link’s conduct in relation to the WEIF. The proposed Scheme is a process to settle all (or most) of the claims against Link in one go.  To be put in place, the “Scheme Creditors” (see para 5 below) of Link need to vote for the Scheme and (if voted for) the Court subsequently needs to approve it.

2. Regarding the vote, all relevant creditors of Link will be bound by the Scheme if it is approved by a majority in number (that is more than 50%), representing 75% or more in value, of the creditors who vote.

3. So, assume (for illustrative purposes only):

 

1. Link owes £400m and has 100,000 creditors; but

 

2. only 10,000 creditors who represent £100m of Link’s debts actually participate in the vote.

 
If more than 5,000 of those voters are for the Scheme and those votes represent more than £75m of the debt, the vote would be passed and the Scheme would be presented to the Court for approval.

4. It would not matter that 90,000 creditors did not vote or that only £75m out of £400m of the debt voted for the Scheme. Moreover, once approved by the Court, the Scheme would bind all creditors whether they voted for or against the Scheme or did not vote at all.

[B]        Am I eligible to vote?

5. “Scheme Creditors” are able to vote on the Scheme. Scheme Creditors are those investors who held shares in the WEIF at the time of its suspension on 3 June 2019, and any person who they transferred or sold their shares to after this date.

6. Shares in the WEIF may have been held directly, or indirectly through an intermediary such as an online investment platform (e.g. the Hargreaves Lansdown platform).

7. If your shares in the WEIF were held indirectly, please consult your investment contract or contact your broker or platform to confirm who is eligible to vote on the Scheme. For example, if you purchased shares in the WEIF via the Hargreaves Lansdown platform, you will be entitled to vote.

8. It is important to note that if you were an investor in the WEIF and redeemed (sold) all of your investment before the suspension date on 3 June 2019, then the Scheme does not apply to you and you are not entitled to vote. This means, regardless of whether the Scheme is approved or not, if you are one of these “fully redeemed prior to suspension” investors, you can still bring claims in Court against Link.  RGL will provide more information in this regard once it is known whether the Scheme is approved or not.

[C]        By when do I need to Vote?

9. In Summary:

 

1. If you wish to attend the Scheme Meeting in person on 13 December 2023 (you do not have to attend), you must submit your Voting Form by 5pm on 30 November 2023;

 

2. Otherwise, the deadline for submitting your Voting Form is 5pm on 4 December 2023.

 

[D]       How do I Vote?

10. See Appendix 1 to these FAQs for some of the detail regarding voting.

11. Whether you decide to vote online, by email, by post or in person, you must first complete and submit a Voting Form by the deadlines referred to above. Unless you have authorised someone else to complete a voting form on your behalf, and they can provide evidence of such authorisation, you will need to complete a Voting Form in your own name.

12. For online voting, you must go to the Voting Portal, which is available here. If choosing this option, the instructions on the Voting Portal will guide you through how to fill in the Voting Form and submit it online.

13. If you are not able to submit a vote online via the Voting Portal, the second option is to download a Voting Form from the Scheme Website here, fill it in and return it by email to Link at lfsoa@huntswood.comor by post to Link at: Link Scheme Vote, PO Box 16840, Birmingham B2 2US.

14. If you do not have internet access, you should contact Link by telephone on +44 20 3991 0224 (local rates apply) and request a Voting Form to be posted to you. Completed Voting Forms may be returned by post to Link at: LFSL Scheme Vote, PO Box 16840, Birmingham B2 2US.

[E]        What is the Scheme Meeting on 13 December 2023?

15. It is at this meeting that the vote will actually take place.

16. You can choose to attend the Scheme Meeting, but you must pre-register via the Voting Portal (see para 12 above) or by telephoning +44 20 3991 0224 (local rates apply) by 5pm on 30 November 2023 if you wish to attend in person; or by 5pm on 4 December 2023 if you wish to attend online or via telephone.

17. You can also ask another person to attend the Scheme Meeting and vote in your place, but they’ll need to provide evidence as part of filling in the Voting Form that they are authorised to vote as a proxy.

18. However, you do not need to attend (whether online or in person) the Scheme Meeting. You can appoint the Chair of the Scheme Meeting to vote on your behalf, and they will do so in accordance with your wishes as indicated on your completed Voting Form.

[F]        What is the FCA’s position in relation to the Scheme?

19. The FCA spent over three years investigating the conduct of Link in relation to the WEIF and published its draft findings in September 2022. In brief summary, the FCA found that Link had failed to comply with its regulatory obligations as ACD in respect of the liquidity management of the WEIF, including failing to properly supervise Neil Woodford’s activities.

20. In light of these identified failings, the FCA concluded that investors who left the WEIF from 1 November 2018 but before its suspension in June 2019 had benefited disproportionately from the sale of the most liquid assets in the WEIF compared investors who remained in the WEIF at the date of suspension.

21. The FCA initially proposed that Link should pay a penalty of £50m and compensation of c.£300m to investors who remained in the WEIF at the date of its suspension. Link disputed the FCA’s findings and conclusions.

22. In April 2023, Link and its parent company entered into a conditional settlement with the FCA, whereby (again in brief summary) all of Link’s available assets would be put towards the settlement, Link’s parent would make a voluntary contribution (which would otherwise not be available) and Link’s insurers would also pay certain monies (which they otherwise might not).

23. The word “conditional” at para 22 above is highlighted because the settlement as described will happen only if the Scheme is voted for, and approved by the Court.

24. Taken together, the settlement amount under the Scheme (if approved) is expected to be “up to £230m”. In fact, the first distribution to investors if the Scheme is approved would be £183.5m, because £46.5m has been set aside to meet certain potential costs and liabilities of Link that may exist even if the Scheme is approved.  To the extent that at least some of this £46.5m is not used up, it would be distributed to Scheme Creditors at some future date(s).

25. In return for Link (and its parent company) agreeing to the Scheme and it being approved, the FCA would approve the sale of Link’s business and require that Link pay compensation to Scheme Creditors (see para 5 above) up to (but no more than) the £230m amount.

26. If the Scheme is not approved by the vote and subsequently the Court, there will not be any settlement without legal action. Link has made no admissions of liability in relation to either the FCA’s investigation or to any other matter and has stated that it would dispute all claims made against it.

27. The FCA has said that it considers the Scheme “offers investors the quickest and best chance to obtain a better outcome than might be achieved by any other means”.

[G]          Are there reasons to question the FCA’s position?

28. The FCA is effectively recommending the Scheme to investors based on: (i) certainty – if the Scheme is approved, the settlement monies (see further below at paras 49 to 51) will definitely be distributed to Scheme Creditors; and (ii) speed – the first distribution of the £183.5m portion of the settlement monies (see para 24 above) is expected to be during Q1 in 2024 (albeit Link notes that this is “under the current timetable”).

29. The “other means” referred to by the FCA (see para 27 above) is litigation in Court. You are a member of the RGL Group and our proposal has been to sue both Link and Hargreaves Lansdown in Court – see further re Hargreaves Lansdown at paras 72 and 73 below – for the losses that you and other RGL Group members have suffered as a result of the collapse of the WEIF.

30. There is no doubt that the litigation process is not certain. RGL’s legal team considers the claims against Link (and Hargreaves Lansdown) are strong claims, but there is no guarantee they will succeed.  It is also true that any recovery of losses from any success at Court is very unlikely to be received during 2024.  If there was a settlement of the litigation, it might occur during 2025.  If the litigation went all the way to trial (which is less usual than a settlement) and succeeded, then investors would probably have to wait until 2026.

31. So, why might you choose to litigate against Link rather than vote for the Scheme and just accept the Scheme compensation payment?

32. The main reason is that it appears to many commentators that the FCA is significantly under-playing: (i) the quantum of the claims against Link; and (ii) the role of the Financial Services Compensation Scheme (“FSCS”).

33. Regarding quantum, the FCA has calculated the total claim against Link at c.£300m and, via the Scheme, feels that a settlement of “up to £230m” to be acceptable. On this basis, the FCA repeatedly asserts that the Scheme represents c.77% of the amount that it considers is claimable against Link.

34. However, leaving aside the relatively small amount the Scheme compensation would actually represent for the average investor – see further below at paras 50 and 51 below – the actual losses suffered by investors as a result of Link’s unlawful conduct may be more than three times the FCA’s £300m number.

35. Certainly, RGL’s legal team considers that losses were suffered by investors well before 1 November 2018 (cf. para 20 above) and also that the type of losses to be claimed in Court would be far wider than the basis of the FCA’s calculation, which simply compares the position of those investors who redeemed their WEIF investment earlier than those investors who were still invested at the date of suspension in June 2019.

36. So, successful claims in Court against Link would likely mean that Link would be ordered by a Judge to pay significantly more than it is offering to pay via the Scheme. But, as you may ask, how would Link actually pay such amounts?  It doesn’t have the assets to do so (and if the Scheme is not approved, there will not be any contribution by Link’s parent company and its insurers may not pay anything either).

37. This is where the FSCS would be relevant. We discuss the role of the FSCS and its present position on WEIF claims further below – see paras 42 to 48.  Suffice it to say here that, if legal claims can be established in Court against Link and Link cannot pay those claims (and is therefore insolvent), certain Scheme Creditors (including private individual investors, small businesses – including those in the form of a limited company – and certain types of trustees) would qualify for compensation from the FSCS of up to £85,000, which exceeds most individual investor’s claim values.

38. All claims made against, and paid by, the FSCS are borne by the financial services industry as a whole via levy charges. As the FCA is ultimately responsible for the general health of the financial services industry, it is not outside the bounds of reasonableness to believe the FCA would prefer that the Link “situation” is confined and contained via the Scheme settlement and does not have any wider impact.

39. There are also questions about the role of the FCA in relation to the demise of the WEIF. What did it actually know about the liquidity issues and when did it know?  Should it have acted earlier to protect investors?  Looked at from a certain point of view – some might say a cynical point of view; others might consider it to be a more realistic one – the Scheme (if approved) neatly wraps things up in the short-term regarding Link’s conduct and would assist to move the glare of public scrutiny away from the FCA in this regard.

40. It is perhaps fair to say that the focus of most investors is not on the role the FCA possibly played, or did not play, in the demise of the WEIF, or the reasons driving the proposal of the Scheme. Most people simply want to know what the Scheme or any alternative course would mean for them.

41. Before moving on to address these key issues, we should explain a little more about the role the FSCS might play if the Scheme is not approved.

[H]       What is the FSCS?

42. The FSCS is the UK’s compensation scheme of last resort for the customers of failed regulated financial services It is a matter for the FSCS to determine whether any payments may become due to investors from the FSCS.

43. Currently, the FSCS has not made any determination in relation to any claims that might be made against It should be noted that, if the Scheme goes ahead, Scheme Creditors (see para 5 above) will not be able to make claims against the FSCS re Link.

44. In an arguably obvious attempt to persuade investors to support the Scheme and not look to rely in the future on the FSCS, both Link and the FCA have been at pains to highlight that:
     
    1. the conclusions of the FCA’s three-year investigation are not finalised, and as such do not represent a binding or final determination regarding Link’s conduct;

     

    2. b. the conclusions are disputed by Link and without the Scheme could take years to resolve;

     

    3. all claims brought in Court could take years to resolve; and

     

    4. the Scheme represents certainty and a payment of at least some amount in the relative short term.

45. By way of counterpoint to the above, it might be pointed out that, although not yet finalised, after a three-year investigation it is not unreasonable to suggest that the FCA is confident that it has discovered conduct by Link that does amount to an unlawful breach of at least some of Link’s statutory duties as the ACD of the WEIF. Yes, litigation in Court will take much longer than any Scheme payment and doubtless Link’s lawyers will vigorously (and expensively) dispute such claims, but in light of the FCA’s findings, Link would not be starting the defence of claims against it from a particularly promising position.

46. Although it is correct to say that the FSCS has not made any determination as yet regarding whether it would pay compensation, the reality is that nobody has yet conclusively established the legality or illegality of Link’s conduct. The FCA’s conclusions are in draft and will be finalised (so the FCA has stated) only if and when the Scheme is approved; and if it is approved, the Scheme will prevent investors making claims on the FSCS!

47. If the Scheme is not approved, claims will be brought against Link in Court. If those claims are established – and it is of course an “if” – then it is unlikely Link would be able to pay some (or all) of its Court-ordered liability.  On its insolvency – and as both Link and the FCA have conceded – “the FSCS would be likely to declare a default and pay compensation to eligible investors”.

48. The maximum amount of compensation from the FSCS would be £85,000 per investor and would very likely be more than the Scheme will generate in terms of a recovery of losses. However, it cannot be overlooked – and RGL does not do so – that the Scheme offers certainty of payment.  Any FSCS payment is not certain and will not be made in the relatively short term.  Moreover, the FSCS is primarily aimed at private individuals, albeit smaller businesses (even if in limited company form) and some types of trustees, can also claim.  If the investment in the WEIF was by a larger company, then FSCS compensation may well not be available in any event.

[I]           How much would I receive if the Scheme is approved?

49. This depends on how many shares you held in the WEIF at the suspension date of 3 June 2019.

50. In broad terms, if the Scheme is voted for and subsequently approved by the Court, the initial distribution of the £183.5m amount (see para 24 above) would mean a payment of between £0.04p and £0.05p per share in the WEIF – see the table at Appendix 2 to these FAQs, below.

51. So, using the example of an investor who held 10,000 A Sterling Income shares in the WEIF at the suspension date on 3 June 2019 (and using the precise amounts in the table at Appendix 2), when the £183.5m is distributed, he or she would receive a total payment of £411.10 in (probably) the first quarter of 2024. If the whole of the £46.5m held back amount (see para 24 above) is subsequently released such that the maximum potential amount of £230m is ultimately distributed under the Scheme, he or she would receive up to an additional £112.10, i.e. a total Scheme compensation payment of £515.30 in respect of his or her 10,000 A Sterling Income shares.

[J]           What happens if the Scheme is approved?

52. Three important things happen if, and when, the Scheme becomes In summary these things are:

 

1. all Scheme Creditors (see para 5 above) will automatically be included in the This means that the Scheme will be legally binding on each Scheme Creditor regardless of whether they voted for or against the Scheme (or voted at all);

 

2. Link will pay the settlement amount to the WEIF, which, in turn, will make the first distribution to Scheme Creditors – likely to be in Q1, 2024; and

 

3. Scheme Creditors will no longer be able to make claims against Link, its parent or associated companies or the FSCS (but claims against Hargreaves Lansdown can still be brought, as has always been proposed by RGL).

 

[K]        What happens if the Scheme is not approved?

53. If the Scheme is voted down, then the conditional settlement (see para 22 above) would fall away. This would mean that Link would not commit its assets to paying claims, Link’s parent company would not make any contribution to any settlement fund and Link’s insurers would not commit to paying any Link-related claims.

54. However, WEIF investors would be able to bring claims in Court against both Link and Hargreaves Lansdown rather than just the latter. As has always been the case, RGL would ensure the funding and insurance of such legal claims such that RGL Group members would not have to pay the costs of bringing claims in Court unless and until such claims are successful and achieve a financial recovery of losses.

55. It is also likely that the FCA would continue its regulatory process against Link, part of which would be the publication in full of its findings against Link, which might well assist the legal process.

56. Doubtless both the claims in Court and the FCA’s findings would be defended by Link and its lawyers, the legal costs of which would erode the amount of money that Link has available to pay any judgment and/or regulatory determination against it. It is also fair to say the litigation (and the FCA process) will not lead to any conclusions/determinations in the short term, and the success of any legal claims cannot be guaranteed.

57. It is likely that Link will not be able to satisfy (in full or at all) any successful legal/regulatory claims brought against it, such that any Court judgment would mean Link had to enter into some kind of insolvency process. However, in such circumstances (see also at paras 42 to 48 above), the FSCS would step in and pay compensation to WEIF investors.

[L]           Why might I consider voting for the Scheme?

58. The main reasons for voting for the Scheme are certainty of payment, albeit payment of a relatively small proportion of your losses (see paras 50 and 51 above); and the relative speed of payment – the first distribution via the Scheme process (if approved) is likely to be during Q1, 2024.

59. Although the legal claims against Link are assessed to be strong, there is no guarantee they will succeed via the Court process of litigation. Litigation against Link is also likely to take up to 3 years if there is no earlier settlement (bearing in mind, however, that most litigation does settle before trial).

60. Aside from these factors of certainty and speed of payment, if you are an investor that would not be entitled to claim against the FSCS in any event (for example, a large company), then you might conclude the Scheme provides the best opportunity to recover at least something from Link. The FSCS is primarily aimed at private individuals, although smaller businesses (even if in limited company form) and some types of trustees can also claim.  However, if the investor in the WEIF is a larger company, then FSCS compensation may well not be available.

61. The Scheme (if approved) does not prevent claims (by any type of WEIF investor) being brought against Hargreaves Lansdown.

62. RGL is the only group bringing claims against Hargreaves Lansdown. RGL also deducts the lowest proportion from any recoveries (see further below at paras 74 to 76).

[M]         Why might I consider voting against the Scheme?

63. The main reason for voting against the Scheme is that legal action in Court could achieve a greater recovery of losses from Link (or the FSCS) than the FCA-backed Scheme settlement presently on offer.

64. The legal claims are assessed as strong claims, and both the scope and quantum of the losses to be pursued against Link in litigation will be greater than the amount that will be received under the Scheme.

65. You might conclude that giving up £400 to £500 per 10,000 shares (see paras 50 to 51 above) held in the WEIF on the suspension date in June 2019 is worthwhile where there is a good chance of recovering a larger amount in Court, particularly also where the proposed litigation will not cost you anything unless and until it is successful, i.e. the action in Court will be funded and insured.

66. Approval of the Scheme will prevent any further claims by Scheme Creditors (see para 5 above), whether in Court or otherwise, against both Link and the FSCS (in relation to Link).

[N]     Will the Scheme impact payments already received from the winding-up of the WEIF?

67. Whether approved or not, the Scheme (or lack thereof) will not mean previous payments have to be repaid.

[O]       What is RGL’s position in relation to the Scheme?

68. RGL cannot advise you on whether to vote for or against the Scheme – we are not authorised to provide any such advice.

69. We are also conscious that it might be said that voting against the Scheme is in RGL’s interests. The legal claim against Link (and any recovery from the FSCS) will be for a larger amount of money than is being offered under the Scheme, such that funders, insurers and RGL could make more money if the Scheme is not approved and the legal claims are successful.  RGL must, therefore, remain neutral.

70. What might be said is that, unless you have strong personal feelings about the way the FCA has acted in relation to the WEIF and/or the Scheme – some pro-investor commentators and groups consider the Scheme to be something of a regulator-sponsored “stitch up” – the decision about whether to vote for or against really boils down to certainty.

71. If you want the certainty of definitely receiving some compensation (albeit a relatively small amount) probably during Q1, 2024, then you would vote for the Scheme. If you want to try to preserve your legal claims against Link on the basis that Court action could recover a larger amount, then you would vote against the Scheme (bearing in mind that if the required majority vote for it, you will be bound by the Scheme in any event).

[P]        What about claims against Hargreaves Lansdown?

72. Whether the Scheme is approved or not, assuming you maintain your membership of the RGL Group, you will still be able to bring a legal claim against Hargreaves Lansdown.

73. Even if the Scheme is approved and you receive your share of the Scheme compensation, the legal claim for losses against Hargreaves Lansdown will still be very significant. As explained above (see paras 20 and 21), the assessment of the Scheme compensation by the FCA has been on the limited basis of its conclusions.  The legal claims in Court against Hargreaves Lansdown will be for losses suffered over a longer period than the FCA’s assessment period and for different types of losses, e.g. the loss of opportunity of investing in alternative funds had you been told earlier about the problems with the WEIF.

[Q]       How much will RGL deduct from any Scheme compensation?

74. If the Scheme is approved, such that you receive compensation during (probably) Q1, 2024, then under the terms of the Litigation Management Agreement (“LMA”) that you signed with RGL, you would be liable to pay 25% (including VAT) of the received amount, to RGL. We would remind you that Leigh Day’s charges are 30% (including VAT) and Harcus Parker’s over 42% (including VAT).

75. However, RGL recognises that if the Scheme is approved, then the claims against Link will have been concluded more quickly than would have been the case in Court. Although RGL has nonetheless incurred a significant amount of time, costs and fees paid in relation to the Link claims, it is very likely that we will apply a substantial discount to the 25% deduction from any Scheme compensation.  Please note that in applying such a discount, we will expect you to remain part of the RGL Group so as to pursue claims in Court against Hargreaves Lansdown (such claims being funded and insured).

76. We will make a final decision on what deduction to apply (but it will be substantially discounted from 25%) and the requirements around it, when we all know whether the Scheme has been approved and the actual amounts to be paid to investors.

[R]          Further Reading

77. We have listed various online links to the detailed documents and information relating to the Scheme in Appendix 3 to these FAQs, below.

78. We would reiterate that these FAQs provide a brief summary of the very detailed documentation that is available about the Scheme and should not therefore be taken as an alternative to reading that detailed documentation in full.

APPENDIX 1

Link Scheme Voting Deadlines and Procedure

Deadline for registering to attend the Scheme Meeting in person: 5pm (London time) on 30 November 2023.

Deadline for submitting Voting Forms: 5pm (London time) on 4 December 2023. Scheme Creditors who wish to vote on the Scheme or attend the Scheme Meeting (online or by telephone) must submit a Voting Form by no later than 5pm (London time) on 4 December 2023.

Scheme Meeting: This will take place on 13 December 2023.  There is no requirement to attend the Scheme Meeting. You can submit your vote beforehand and instruct the Chair to vote for you at the meeting. The Chair is bound to vote in accordance with your directions.

Scheme Creditors will have an opportunity to discuss the Scheme with Link and other Scheme Creditors at the Scheme Meeting and vote on the Scheme. If you cannot attend the Scheme Meeting the Chair of the Scheme Meeting can vote for the Scheme Creditor in accordance with their wishes.  You can also ask another person to attend and vote at the Scheme Meeting on your behalf.

Second Court Hearing: This will take place on 18 January 2024. If enough Scheme Creditors vote in favour of the Scheme at the Scheme Meeting, Link will ask the Court to approve the Scheme at this hearing.

Filing Date: This is expected to take place on or about 19 January 2024. The Filing Date will occur once a copy of the Court order approving the Scheme (if it is approved) is delivered to the Registrar of Companies.  With effect from the Filing Date, Scheme Creditors will be unable to commence or continue claims against Link and other members of the Link Group.

Effective Time: This is expected to take place on or about 9 February 2024. The Scheme will become fully effective on the Effective Time.

What do I need to do to vote within the timeframes above?

Full details on how to vote are at:

FAQs – LF Woodford Equity Income Fund Settlement Scheme (lfwoodfordfundscheme.com)

1. The first and easiest option to vote on the Scheme is online via the Voting Portal, which is available here. You must submit your vote by no later than 5.00 p.m. on 4 December 2023. If choosing this option, the instructions on the portal will guide you through how to fill in the Voting Form and submit it online;

2. If you are unable to submit a vote online via the Voting Portal, the second option is to download a Voting Form from the Scheme Website here, fill it in and return it by email to LFSL at lfsoa@huntswood.com or post to LFSL at LFSL Scheme Vote, PO Box 16840, Birmingham B2 2US. The Voting Form must be received by LFSL by no later than 5.00 p.m. on 4 December 2023; or

3. The third option is to contact LFSL by telephone on +44 20 3991 0224 (local rates apply) and request a Voting Form to be emailed or posted to you. Completed Voting Forms may be returned by email to LFSL at lfsoa@huntswood.com or posted to LFSL at LFSL Scheme Vote, PO Box 16840, Birmingham B2 2US. Once again, the completed Voting Form must be received back by no later than 5.00 p.m. on 4 December 2023.

As part of the Voting Form, you will be asked to choose how your vote is cast at the Scheme Meeting, which will be held on 13^th December 2023.  You can do this in one of three ways:

1. You can choose to appoint the Chair of the Scheme Meeting to vote on your behalf. They will do so in accordance with your wishes as indicated on the Voting Form you’ve filled in. There is no need to attend the Scheme Meeting in this case.

2. You can also choose to attend the Scheme Meeting and cast your vote in person if you’d like to do so.

3. Finally, you can ask another person to attend the Scheme Meeting and vote in your place but as already noted, they’ll need to provide evidence as part of filling in the Voting Form that they are authorised to vote as a proxy.

APPENDIX 2

Pence Per Share Distributions and Worked Example

As part of the Scheme documents, Link has put together the table below indicating the anticipated pence per share distribution to be made under the Scheme if it is approved (Columns D and E).

Link has stated that the “distributions under the Scheme” figures specified in the table below are “given by way of illustration only and may be subject to change” and that you should read the important notes that follow the table.

 Important Notes

In the table above that Link has provided, the column heading are:

1. the ISIN identification numbers per share class;

2. a description of each share class, as set out in the prospectus;

3. the total Scheme settlement amount per share class;

4. the pence per share payment based on an assumed distribution amount of £183.5 million, which is the currently estimated total distribution to be made in the first quarter of 2024. In the event that the £46.5m amount that has been held back (see para 24 above in the FAQs) is used in full to pay cost contingencies, there will be no further distributions made;

5. the pence per share payment based on a distribution amount of £230 million is the maximum potential amount of the Scheme compensation. This amount would be paid in the event that none of the £46.5m amount that has been held back (see para 24 above in the FAQs) is required to pay for Link’s liabilities or other costs and liabilities (beyond the £5 million that has been set aside to pay for such costs)

APPENDIX 3

Further Reading

Where can I find out more about the Scheme?

A wealth of very detailed documents that provide further information about the Scheme are available at:

https://lfwoodfordfundscheme.com/documents/

Such documents include the Scheme documents including:

1. Explanatory Statement;
2. Scheme Rules (including the Release Deed);
3. Notice of Scheme Meeting;
4. Voting Form;
5. Court order convening the Scheme Meeting;
6. Practice Statement Letter;
7. Report of the Chair of the Investors’ Committee;
8. Report of the Investor Advocate;
9. FCA Investigation Summary and the FCA Redress Calculation;
10. FSCS Non-objection Letter;
11. Third Party Litigation Deed;
12. Group Contribution Deed

A spreadsheet setting out the FCA Redress Calculation is available at https://lfwoodfordfundscheme.com/documents/.

The FCA announcements in respect of redress to investors in the WEIF can be found at:

• https://www.fca.org.uk/news/statements/fca-statement-regarding-potential- enforcement-action-against-link-fund-solutions-ltd (FCA announcement dated 21 September 2022)

and

• deliver-significant-redress-woodford-investors (FCA announcement dated 19 April 2023).