Octopus Apollo VCT

Octopus Apollo VCT ProspectusThe issue by Octopus Apollo VCT plc of Scheme Shares in connection with the acquisition of the assets and liabilities of Octopus Eclipse VCT plc.

Offer for Subscription by Octopus Apollo VCT plc, for the tax years 2016/2017 and 2017/2018, to raise up to £20 million by way of an issue of Offer Shares.

4 November 2016

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THISDOCUMENTISIMPORTANTANDREQUIRESYOURIMMEDIATEATTENTION

If youare in anydoubt about the action tobe taken, you should immediately consult yourbankmanager,stockbroker, solicitor, accountant or financial adviser authorised pursuant to the Financial Services andMarketsAct2000(FSMA).This document, which comprises a prospectus relating to Octopus Apollo VCT plc (the “Company”) dated 4November2016,hasbeenpreparedinaccordancewiththeprospectusrulesmadeunderPartVIofFSMA,andhas been approved for publication by the Financial Conduct Authority as a prospectus under the ProspectusRuleson4November2016.The Company, the Directors and the Proposed Director, whose names appear on pages 30 to 31 of thisdocument, accept responsibility for the information contained herein. To the best of the knowledge of theCompany,theDirectorsandtheProposedDirector(whohavetakenallreasonablecaretoensurethatsuchisthe case), the information contained in this document is in accordance with the facts and does not omitanythinglikelytoaffecttheimportofsuchinformation.Persons receiving this document shouldnote thatHowardKennedy,which is authorisedand regulated in theUnitedKingdombytheFinancialConductAuthority,isactingassponsorfortheCompanyandno-oneelseandwill not, subject to the responsibilities and liabilities imposed by FSMA or the regulatory regime establishedthereunder,beresponsibletoanyotherpersonforprovidingtheprotectionsaffordedtocustomersofHowardKennedyorprovidingadviceinconnectionwithanymattersreferredtoherein.

OctopusApolloVCTplc

(registerednumber5840377)

Prospectusrelatingto:

theissuebyOctopusApolloVCTplcofSchemeSharesinconnectionwiththeacquisitionoftheassetsandliabilitiesofOctopusEclipseVCTplc

offerforsubscriptionbyOctopusApolloVCTplc ofOfferSharestoraiseuptoamaximumof£20million,

payableinfullincashonapplication

SponsorHowardKennedyCorporateServicesLLP

TheordinarysharesoftheCompanyinissueatthedateofthisdocumentarelistedonthepremiumsegmentoftheOfficialListof theUKListingAuthorityandtradedontheLondonStockExchange’smainmarket for listedsecurities.ApplicationhasbeenmadetotheUKListingAuthority foralloftheNewSharestobe listedonthepremiumsegmentof theOfficialListandapplicationwillbemadeto theLondonStockExchange for theNewSharestobeadmittedtotradingonitsmainmarketforlistedsecurities.Itisexpectedthatsuchadmissionwillbecomeeffectiveandthattradingwillcommenceon20December2016withregardstotheSchemeSharesandwithin10businessdaysof theirallotmentwith regards to theOfferShares.TheNewShareswillbe issued inregisteredformandwillbefreelytransferableinbothcertificatedanduncertificatedform.TheNewShareswillrank pari passu in all respects with the existing Shares. The Offer is conditional on the passing by theShareholdersofResolution2attheGeneralMeeting.TheOfferisnotbeingmade,directlyorindirectly,inorintotheUnitedStates,Canada,Australia,NewZealand,JapanortheRepublicofSouthAfricaortheirrespectiveterritoriesorpossessions,anddocumentsshouldnotbedistributed,forwardedortransmittedinorintosuchterritories.TheNewShareshavenotbeenandwillnotberegistered under the United States Securities Act of 1933 (as amended) and may not be offered, sold ordelivered, directly or indirectly, in or into the United States, Canada, Australia, New Zealand, Japan or theRepublicofSouthAfrica.

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CONTENTS SUMMARY 4RISKFACTORS 15 EXPECTEDTIMETABLE,OFFERSTATISTICSANDCOSTS 17LETTERFROMTHECHAIRMAN 19PARTONE:THESCHEME 23TheScheme 23ConditionsoftheScheme 24TermsoftheScheme 24ShareCertificates,MandatesandListing 26Taxation 26PARTTWO:THEOFFER 28IntroductiontotheOffer 28TermsoftheOffer 28UseofFunds 28IntermediaryCharges 29InvestmentPolicy 29TaxBenefitsforInvestors 29DividendPolicyandDividendReinvestmentScheme 29BuybackPolicy 30TheBoard 30TheInvestmentTeam 32ManagementRemuneration 33InvestmentProcess 33PerformanceHistory 33ExampleInvestments 34MergerPlans 35ConflictsofInterest 36PARTTHREE:TAXPOSITIONOFSHAREHOLDERS,ECLIPSESHAREHOLDERSANDINVESTORSUNDERTHEOFFER 37PARTFOUR:PROFORMAFINANCIALINFORMATION 42PARTFIVE:FINANCIALINFORMATIONRELATINGTOTHECOMPANYANDECLIPSE 47PARTSIX:INVESTMENTPORTFOLIOOFTHECOMPANYANDECLIPSE 51PARTSEVEN:ADDITIONALINFORMATIONRELATINGTOTHECOMPANY 54DEFINITIONS 79TERMSANDCONDITIONS 83ANNEXI:TERMSANDCONDITIONSOFTHEDIVIDENDREINVESTMENTSCHEMEOFOCTOPUS 89APOLLOVCTPLC ANNEXII:DIVIDENDREINVESTMENTSCHEMEMANDATEFORM 95

LISTOFADVISERSTOTHECOMPANY 97

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SUMMARY

Summariesaremadeupofdisclosurerequirementsknownas‘Elements’.TheElementsarenumberedinSectionsA—E.ThissummarycontainsalltheElementsrequiredtobeincludedinasummaryforthistypeofsecuritiesandissuer.BecausesomeElementsarenotrequiredtobeaddressedtheremaybegapsinthenumberingsequenceoftheElements.EventhoughanElementmayberequiredtobeinsertedintothesummarybecauseofthetypeofsecuritiesandissuer,itispossiblethatnorelevantinformationcanbegivenregardingtheElement.InthiscaseashortdescriptionoftheElementisincludedinthesummarywiththementionof‘notapplicable’.

SectionA-IntroductionandWarnings

Element Disclosurerequirement

Disclosure

A.1 Warning Thissummaryshouldbereadasan introductiontotheProspectus.Anydecisionto invest inthesecuritiesshouldbebasedonconsiderationoftheProspectusasawholebytheinvestor.Where a claim relating to the information contained in the Prospectus is brought before acourt, the plaintiff investormight, under the national legislation of the EEA States, have tobear the costsof translating theProspectusbefore the legalproceedingsare initiated. Civilliability attaches only to those persons who have tabled the summary, including anytranslation thereof, but only if the summary ismisleading, inaccurate or inconsistentwhenread together with the other parts of the Prospectus or it does not provide, when readtogetherwithotherpartsof theProspectus, key information inorder toaid investorswhenconsideringwhethertoinvestinsuchsecurities.

A.2 ConsentforUseofProspectusbyfinancialintermediaries

TheCompanyandtheDirectorsconsenttotheuseoftheProspectus,andacceptresponsibilityfor the content of the Prospectus, with respect to subsequent resale or final placement ofsecuritiesby financial intermediaries, from thedateof theProspectusuntil the closeof theOffer.TheOfferisexpectedtocloseonorbefore3November2017.TheMergerisexpectedtocompleteon19December2016.Therearenoconditionsattachingtothisconsent.FinancialintermediariesmustgiveinvestorsinformationonthetermsandconditionsoftheOfferatthetimetheyintroducetheOffertoinvestors.

ScheduleB–Issuer

Element Disclosure

requirementDisclosure

B.1 Legalandcommercialname

OctopusApolloVCTplc.

B.2 Domicileandlegalform

OctopusApolloVCTplcwasincorporatedandregisteredinEnglandandWaleson7June2006asapubliccompanylimitedbysharesundertheCompaniesAct1985withregisterednumber5840377.

B.5 Groupdescription

TheCompanyisnotpresentlypartofagroup.

B.6 Majorshareholders

TheCompanyisnotawareofanypersonorpersonswhohave,orwhofollowingtheOfferandtheMergerwillorcouldhave,directlyorindirectly,votingrightsrepresenting3%ormoreofthe issued share capital of the Company orwho can, or could, following theOffer and theMerger,directlyorindirectlyexercisecontrolovertheCompany.TherearenodifferentvotingrightsforanyShareholder.

B.7 Selectedfinancial

Selected historical financial information relating to the Company,which has been extractedfromtheauditedandunauditedfinancialstatementsreferencedinthefollowingtables,isset

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information outbelow: YearEnded

31January2014

(audited)

YearEnded31January

2015(audited)

YearEnded31January

2016(audited)

Sixmonthsended31July2015

(unaudited)

Sixmonthsended31July2016

(unaudited)

Net assets(£’000)

63,905 119,563 127,741 134,238 152,139

Net assetvalue perShare (p)(Ordinary, COrdinary, DOrdinary)

86.8,N/A,N/A

84.8,98.2,N/A

82.3,N/A,93.7

83.6,98.0,N/A

83.0,N/A,92.3

Revenuereturnafter

expensesandtaxation(£’000)

1,599 1,630 1,689 1,182 1,052

NAVpluscumulativedividendspaid(p)

(Ordinary,COrdinary*,DOrdinary**)

109.3,N/A,N/A

112.3,105.0,N/A

114.8,N/A,98.7

113.6,105.0,N/A

115.5,N/A,97.3

DividendpaidperShareduringtheperiod(p)

(Ordinary,COrdinary*,DOrdinary**)

5.0,N/A,N/A

5.0,N/A,N/A

5.0,N/A,N/A

2.5,N/A,N/A

2.5,N/A,N/A

TotalExpenses(£’000)

2,174 3,551 4,405 2,086 2,163

Asapercentageof

averageShareholders’

funds

3.4% 3.0% 3.4% 1.6% 1.4%

EarningsperShare(p)

2.5 3.3 2.0 1.0 0.8

* This includes dividends paid to shareholders formerly inOctopus VCT Plc prior tomergerwiththeCompanyon28November2014.**ThisincludesdividendspaidtoshareholdersformerlyinOctopusVCT2PlcpriortomergerwiththeCompanyon27January2016.On28November2014theCompanymergedwithOctopusVCTplcwithatotalof52,035,840Cordinarysharesof1penceeachbeingissuedtoformershareholdersofOctopusVCTplc.

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Netproceedsof£23.4million,£3.9millionand£26.7millionand£39.5millionwereraisedbytheCompanyunderoffersforsubscriptionwhichopenedon1October2012,1December2013,24October2014and2November2015respectively.On21August2015apaymentof98.0pperCsharewaspaidinrespectofthoseCsharesthatdidnotconverttoShares,reducingtheNAVoftheCompanybyapproximately£34million.On27January2016theCompanymergedwithOctopusVCT2plcwithatotalof19,082,726Dordinarysharesof1penceeachbeingissuedtoformershareholdersofOctopusVCT2plc.On4August2016apaymentof92.3pperDsharewaspaidinrespectofthoseDsharesthatdidnotconverttoShares,reducingtheNAVoftheCompanybyapproximately£14.4million.Saveinrespectofthesematters,bothduringthefinancialperiodsreferredtoaboveandsince31 July 2016 there has been no significant change in the financial condition or operatingresultsoftheCompany.

B.8 Keyproformafinancialinformation

Unauditedproformastatementofearnings

ThefollowingunauditedproformastatementofearningsoftheEnlargedCompanyhasbeenpreparedtoillustratetheeffectoftheMergerandtheOfferontheearningsofApolloforthesixmonthsended31July2016asiftheMergerandtheOfferhadoccurredatthestartoftheperiod,1February2016.ThesixmonthearningsforEclipsearefortheperiodended31March2016.

Theunauditedpro forma statementof earningshasbeenprepared for illustrativepurposesonly and, becauseof its nature, addresses ahypothetical situation anddoesnot, therefore,representApollo’sactualfinancialpositionorresultsnorisitindicativeoftheresultsthatmayormaynotbeexpectedtobeachievedinthefuture.

TheunauditedproformastatementofearningsisbasedontheearningsofApolloforthesixmonthsended31July2016,assetoutintheunauditedhalf-yearlyreportoftheCompanyforthe sixmonthsended31 July2016andhasbeenprepared inamanner consistentwith theaccountingpoliciesadoptedbyApolloinpreparingsuchinformationandonthebasissetoutinthenotessetoutbelow.

Unauditedproformastatementofearnings

OctopusApollo

OctopusEclipse Merger

VCTPlc VCTPlc Costs

Proforma

(Note1) (Note2) (Note3) total

£'000 £'000 £'000 £'000

Realisedgainondisposaloffixedassetinvestments 987 143 - 1,130Fixedassetinvestmentholdinggains 367 41 - 408Currentassetinvestmentholdinggains - - -

Investmentincome

2,188 207 - 2,395

Investmentmanagementfees (1,405) (351) - (1,756)

Otherexpenses

(758) (273) (331) (1,362)Returnonordinaryactivitiesbeforetax 1,379 (233) (331) 815

Taxationonreturnofordinary (70) - - (70)

II:6II:6

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activities

Returnonordinaryactivitiesaftertax

1,309 (233) (331) 745

Notes1. TheearningsofApolloforthesixmonthsended31July2016havebeenextractedwithout

material adjustment from the unaudited half-yearly report of the Company for the sixmonthsended31July2016.

Adjustments

2. The earnings of Eclipse for the sixmonths ended 31March 2016 have been extractedwithoutmaterialadjustment fromtheunauditedhalf-yearly reportofEclipse for thesixmonthsended31March2016.Thisadjustment isexpectedtohaveacontinuing impactontheearningsoftheCompany.

3. An adjustment has been made to reflect the transaction costs relating to the Merger

whicharetobeexpensed.ThecommissiononthegrossproceedsoftheOfferwillbesetoffagainstthesharepremiumaccountwithinShareholder'sequity.Noaccounthasbeentaken of any potential irrecoverable VAT. This adjustment will not have a continuingimpactontheearningsoftheCompany.

4. Noaccounthasbeentakenoftheeffectsofanysynergies,andofthecostsformeasures

taken to achieve those synergies, thatmay have arisen had theMerger occurred on 1February2016andthatmaysubsequentlyhaveaffectedtheresultsoftheCompanyinthesixmonthsended31July2016.

5. NoaccounthasbeentakenofthetradingperformanceofApollosince31July2016orthe

trading performance of Eclipse since 31 March 2016 nor of any other event save asdisclosedabove.

Unauditedproformastatementofnetassets

ThefollowingunauditedproformastatementofnetassetsoftheEnlargedCompanyhasbeenpreparedtoillustratetheeffectonthenetassetsofApolloasiftheMergerandtheOfferhadtakenplaceon1February2016.TheunauditednetassetsofEclipsearestatedasat31March2016.

Theunauditedproformastatementofnetassetshasbeenpreparedforillustrativepurposesonly and, becauseof its nature, addresses ahypothetical situation anddoesnot, therefore,representApollo’sactualfinancialpositionorresults.

TheunauditedproformastatementofnetassetsisbasedonthenetassetsofApolloasat31July2016,as setout in theunauditedhalf-yearly reportof theCompany for the sixmonthsended31July2016andhasbeenpreparedinamannerconsistentwiththeaccountingpoliciesadoptedbyApolloinpreparingsuchinformationandonthebasissetoutinthenotessetoutbelow.

Unauditedproformastatementofnetassets

OctopusApolloVCT

Plc

OctopusEclipseVCT

PlcFund

raisingPro

forma

(Note1) (Note2) (Note3) total

£'000 £'000 £'000 £’000

115,435 26,234 - 141,669

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Fixedassetinvestments

Currentassets:

Moneymarketfunds - 2,046 - 2,046

Debtors 5,248 286 - 5,534

Cashatbank 35,632 4,261 18,500 58,393

40,880 6,593 18,500 65,973

Creditors (4,176) (213) - (4,389)

Netcurrentassets 36,704 6,380 18,500 61,584

Netassets 152,139 32,614 18,500 203,253Notes1. The net assets of Apollo as at 31 July 2016 have been extracted without material

adjustment from the unaudited half-yearly report of the Company for the six monthsended31July2016.

Adjustments

2. The net assets of Eclipse as at 31 March 2016 have been extracted without materialadjustmentfromtheunauditedhalf-yearlyreportofEclipseforthesixmonthsended31March2016.

3. TheOfferisestimatedtoraisenetproceedsof£18.5million(£20.0milliongrossproceeds

lessestimatedexpensesof£1.5million).Themergercostshavealsobeenaccountedfor.4. NoaccounthasbeentakenofthefinancialperformanceofApollosince31July2016or

thetradingperformanceofEclipsesince31March2016norofanyothereventsaveasdisclosedabove.

B.9 Profitforecast Notapplicable.Noprofitforecastorestimatemade.

B.10 Descriptionof

thenatureofanyqualificationsintheauditreportonthehistoricalfinancialinformation

Notapplicable.Theauditreportsonthehistoricalfinancial informationcontainedwithinthedocumentarenotqualified.

B.11 Insufficientworkingcapital

Not applicable. The Company is of the opinion that the working capital available to theCompany is sufficient for theCompany’spresent requirements (that is, forat least thenexttwelvemonthsfromthedateofthisdocument).

B.34 Investmentobjective andpolicy includinginvestmentrestrictions

InvestmentPolicyTheCompany’sinvestmentpolicyisdesignedtoenabletheCompanytocomplywiththeVCTqualifyingconditions.Itisintendedthatthelong-termdispositionoftheCompany’sassetswillbenot less than80% inaportfolioofunquoted investmentsandup to20% incashornearcash investments to provide a reserve of liquidity which will maximise the Company’sflexibility as to the timing of investment acquisitions and disposals, dividend payments andsharebuybacks.Investments are structured using various unquoted investment instruments, includingordinary and preference shares, loan stocks and convertible securities, to achieve anappropriate balance of income and capital growth, having regard to the venture capitallegislation.Theportfolioisdiversifiedbyinvestinginabroadrangeofindustrysectorsandbyholdinginvestmentsincompaniesatvariousstagesofmaturityinthecorporatedevelopment

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cycle,thoughinvestmentsarenotgenerallymadeinearlystagecompanieswhichhaveyettoachieveprofitabilityandcashgeneration.Thenormal investmentperiodis intherangefromfivetosevenyears.Anyuninvestedfundsaretypicallyheldincashandmoneymarketfunds.Riskisspreadbyinvestinginanumberofdifferentbusinesseswithindifferentindustrysectorsusingavarietyofsecurities.Themaximumamountinvestedinanyonecompanyislimitedtoany HMRC annual investment limits and, generally, no more than 15% of the Company’sassets,atcost,areinvestedinthesamecompany.The value of individual investments is expected to increase over time as a result of tradingprogress and a continuous assessment is made of investments’ suitability for sale. TheCompany’s VCT qualifying investments are heldwith a view to long-term capital growth aswell as income and will often have limited marketability; as a result it is possible thatindividualholdingsmaygrowinvaluetothepointwheretheyrepresentasignificantlyhigherproportionof totalassetsprior toa realisationopportunitybeingavailable. Investmentsarenormallymadeusingshareholders’fundsanditisnotintendedthattheCompanywilltakeonanylong-termborrowings.

B.35 Borrowinglimits The Articles restrict borrowings to 50% of the adjusted capital andreserves.The currentpolicy, however, is that investments will normally be made using the shareholders’ fundsand it is not intended that the Companywill take on any long-termborrowings. As at thedate of this document the Company has noborrowings.

B.36 Regulatorystatus

TheCompanyisauthorisedandregulatedbytheFCAasaselfmanagedalternativeinvestmentfund.

B.37 Typicalinvestor A typical investor forwhomtheCompany isdesigned isaUK taxpayerover18yearsofagewith an investment range of between £5,000 and £200,000who, having regard to the riskfactorssetoutinSectionDofthisSummary,considerstheInvestmentPolicytobeattractive.Thismayincluderetail,institutionalandsophisticatedinvestorsandhighnetworthindividualswhoalreadyhaveaportfolioofnon-VCTinvestments.

B.38 Investmentof20%ormoreinasingleunderlyingassetorinvestmentcompany

Notapplicable. TheCompanywill not investmore than20% ina singleunderlyingassetorinvestmentcompany.

B.39 Investmentof40%ormoreinasingleunderlyingassetorinvestmentcompany

Notapplicable. TheCompanywill not investmore than40% ina singleunderlyingassetorinvestmentcompany.

B.40 Applicant’sserviceproviders

Octopusreceivesanannualinvestmentmanagementfeeofanamountequal to 2% of thenet assets of the Company. Octopus also receives an annual administration andaccounting feeequalto0.3%ofthenetassetsoftheCompanyandacompanysecretarialfee of £20,000. Theannualadministrationandaccounting feearrangementswill continueto apply to the Enlarged Company, spread across the enlarged net assets. The annualinvestmentmanagementfeewillcontinuetoapplyinrespectoftheEnlargedCompany.Octopus is entitled to an annual performance related incentive fee in each accountingperiod, subjecttotheNAVpluscumulativedividendspaidbeingatleast100pattheendoftherelevantperiod.Theamountofthefeewillbeequalto20%oftheamountbywhichtheNAVpluscumulativedividendspaidattheendoftherelevantperiodexceedsthehigherofthe:

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• NAVpluscumulativedividendspaidasatthepreviousyearendplustheaverageBankofEnglandbaserateovertheperiodand

• the highest NAVplus cumulativedividendspaidas at the end of the accountingperiodcommencingon1February2012oranysubsequentaccountingperiod.

The annual performance related incentive fee arrangements will continue to apply to theEnlargedCompany.

B.41 Regulatory

statusoftheManager/custodian

OctopusisauthorisedandregulatedbytheFinancialConductAuthority.

B.42 CalculationofNetAssetValue

TheNAVofaShareiscalculatedinaccordancewiththeCompany’saccountingpoliciesandispublishedatleasteverysixmonthsthroughaRegulatoryInformationService.The calculationof theNAVper Sharewouldonlybe suspended in circumstanceswhere theunderlying data necessary to value the investments of the Company could not readily, orwithout undue expenditure, be obtained. Details of any suspension in making suchcalculationswillbeannouncedthroughaRegulatoryInformationService.

B.43 Cross liability reumbrellacollectiveinvestmentundertaking

Notapplicable.TheCompanyisnotanumbrellacollectiveinvestmentundertakingandassuchthere is no cross liability between classes of Shares or investment in another collectiveinvestmentundertaking.

B.44 Nofinancialstatementshavebeenmadeup

Notapplicable.TheCompanyhascommencedoperationsandhistoricalfinancialinformationisincludedwithinthedocument.

B.45 Portfolio TheCompany’sinvestmentportfoliocomprisespredominantlyUKunquotedcompaniesacrossvarious sectors including software, engineering, telecommunications, distribution amdmanufacturing.TheCompany’sportfolioof investmentswasvaluedat£115.4millionasat31July2016(thedatetowhichthemostrecentunauditedfinancialinformationhasbeendrawnup).Sincethisdate, the Company’s has sold it’s holdings in CSL DualCom Holdings Limited and AtlanticScreenInternationalLimited,bringingthevalueoftheportfoliodownto£103million.

B.46 MostrecentNetAssetValue

TheunauditedNAVperShareasat31July2016was83.0p.Adividendof2.5pperSharewassubsequentlypaidon26August2016.

SectionC—Securities

Element Disclosure

requirementDisclosure

C.1 Typesandclassofsecurities

TheCompanywillissuenewordinarysharesof1peachpursuanttotheSchemeandtheOffer.TheISINandSEDOLoftheSchemeSharesandOfferSharesareGB00B17B3479andB17B347respectively.

C.2 Currency Sterling.

C.3 Numberofsecuritiestobe

ThemaximumnumberofOfferSharestobeissuedpursuanttotheOfferis23,474,178OfferShares assuming a full subscription and an Offer Price of 85.2p. The number of Scheme

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issued Shares to be issued pursuant to the Schemewill be determined at the Scheme CalculationDatebyreferencetotheMergerValueandtheRoll-OverValue.

C.4 Descriptionoftherightsattachingtothesecurities

AsRegardsIncome:TheholdersoftheSharesshallbeentitledtoreceivesuchdividendsastheDirectorsresolvetopayinrespectoftheShares.AsRegardsCapital:Onareturnofcapitalonawindinguporanyotherreturnofcapital(otherthanonapurchaseby the Company of its shares) the surplus capital and assets shall be divided amongst theholders of Shares pro rata according to the nominal capital paid up on their respectiveholdingsofShares.AsRegardsVotingandGeneralMeetings:Subject to disenfranchisement in the event of non-compliance with a statutory noticerequiringdisclosureastobeneficialownership,eachholderofSharespresentinpersonorbyproxyshallonapollhaveonevoteforeachShareofwhichheistheholder.AsRegardsRedemption:TheSharesarenotredeemable.

C.5 Restrictionsonthefreetransferabilityofthesecurities

Notapplicable.TherearenorestrictionsonthefreetransferabilityoftheShares.

C.6 Admission ApplicationhasbeenmadetotheUKListingAuthorityfortheNewSharestobeadmittedtothepremiumsegmentoftheOfficialListandanapplicationwillbemadetotheLondonStockExchangefortheNewSharestobeadmittedtotradingontheLondonStockExchange’smainmarketforlistedsecurities.Itisexpectedthatsuchadmissionswillbecomeeffective,andthatdealingswillcommence,on20December 2016withregardstotheSchemeSharesandwithin10businessdaysoftheirallotmentwithregardstotheOfferShares.

C.7 Dividendpolicy Generally,aVCTmustdistributebywayofdividendsuchamountastoensurethatitretainsnotmorethan15%ofitsincomefromsharesandsecurities.TheDirectorsaimtopaytaxfreedistributionstoShareholders.

SectionD—Risks

Element Disclosure

requirement

Disclosure

D.2 Keyinformationonthekeyrisksspecifictotheissuer

• Shareholders may be adversely affected by the performance of the investments,whichmay restrict the ability of the Company to distribute any capital gains andrevenuereceivedontheinvestments.

• TheCompany’sinvestmentsmaybedifficult,andtaketime,torealise.• Investment in unquoted companies, which comprise most of the Company’s

portfolio of companies, by its nature, involves a higher degree of risk thaninvestmentincompanieslistedontheOfficialList.

• The Company will only pay dividends on its Shares to the extent that it hasdistributable reserves and cash available for that purpose. The Finance Act 2014amendedtheVCTRulesinrespectofVCTsharesissuedonorafter6April2014,suchthatVCTstatuswillbewithdrawn if, inrespectofshares issuedonorafter6April2014, a dividend is paid (or other forms of distribution or payments aremade toinvestors) from capital within three years of the end of the accounting period inwhichshareswereissuedtoinvestors.ThismayreducetheamountofdistributablereservesavailabletotheCompanytofunddividendsandsharebuybacks.

• TheFinanceAct2014restrictsincometaxreliefonsubscriptiontoaVCTafter5April2014where,within6months,whetherbeforeorafterthesubscription,theinvestor

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haddisposedofsharesinthatVCToraVCTwhichatanytimemergeswiththatVCT.

D.3 Keyinformationonthekeyrisksspecifictothesecurities

• Thevalueof theSharesmaygodownaswell asup. Shareholdersmaynot receivebackthefullamountinvestedandcouldlosepartoralloftheirinvestment.

• ThereisnocertaintythatthemarketpriceofShareswillfullyreflecttheirunderlyingNAVorthatanydividendswillbepaid,norshouldShareholdersrelyuponanysharebuybackpolicytoofferanycertaintyofsellingtheirSharesatpricesthatreflecttheunderlyingNAV.

• AlthoughtheexistingShareshavebeen(anditisanticipatedthattheNewShareswillbe)admittedtothepremiumsegmentoftheOfficialListandare(orwillbe)tradedon the LondonStockExchange’smarket for listed securities, the secondarymarketfor VCT shares is generally illiquid and Shareholdersmay find it difficult to realisetheirinvestment.

SectionE—OfferElement Disclosure

requirementDisclosure

E.1 NetproceedsandexpensesoftheIssue

The Merger will not result in any proceeds being raised by the Company. The aggregateanticipatedcostsofundertakingtheMergerareapproximately£331,000.The aggregate net proceeds of the Offer, assuming a £20 million subscription and themaximum initial charge, will be £18.5 million. The costs and expenses (excluding VAT butincluding initial intermediary commission) relating to the Offer for the Company and theexpenseschargedtoan investor,eitherdirectlyor indirectly,willbeupto7.5%ofthegrossfundsraisedbytheCompany.

E.2a ReasonfortheOffer,useofproceedsandestimatednetamountoftheproceeds

TheCompany’ssuccesstodatehashighlightedthatthemodelusedbyOctopusisonethatcanlead to good returns. TheBoardbelieves that theCompany’s portfolio iswell positioned tocontinuethistrend,deliveringregularincometothoseinvestorsabletotakealong-termviewtoinvestinginwell-run,VCTqualifyingUKcompanies.TheBoardalsobelievesthatthefundinggapcreatedbythebanks’reluctancetofundsmallercompanies,meansthatthereareplentyofstronginvestmentopportunitiesthatcanbeaccessed. ThefundsraisedundertheOfferwillbeinvestedinaccordancewiththeCompany’sinvestmentpolicy.SomeofthefundsraisedwillbeusedtoinvestintonewportfoliocompaniesandsomemaybeusedtofurthersupporttheCompany’s existing portfolio. The net proceeds of the Offer, assuming a £20 millionsubscriptionandthemaximuminitialcharge,willbe£18.5million.

E.3 TermsandconditionsoftheOffer

TheOfferPricewillbedeterminedbythefollowingformula:

• themostrecentlyannouncedNAVperShareoftheCompany,dividedby0.945The Company announces its NAV on a six monthly basis. Where the share price for theCompany has been declared ex-dividend on the London Stock Exchange, the NAV used fordeterminingtheOfferPricefortheCompanywillbeex-dividend. InrespectoftheOffer,theNAVperOfferSharewillberoundeduptoonedecimalplaceandthenumberofOfferSharestobeissuedwillberoundeddowntothenearestwholenumber(fractionsofOfferShareswillnot be allotted). Where there is a surplus of application funds, these will be returned toapplicantswithoutinterest,exceptwheretheamountislessthantheOfferPriceofoneOfferShareinwhichcaseitwillbedonatedtocharity.TheOfferwillbeclosedonfullsubscription,i.e.oncethefull£20millionhasbeenraised.TheBoardreservestherighttoclosetheOfferearlierandtoacceptapplicationsand issueOfferSharesatanytimepriortothecloseoftheOffer.OfferSharesissuedwillrankparipassuwiththeexistingSharesfromthedateofissue.The Offer is conditional upon the passing by Shareholders of Resolution 2 at the GeneralMeeting.

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E.4 Material

interests

Notapplicable.NointerestismaterialtotheissueoftheNewShares.

E.5 Nameofpersonsellingsecurities

Not applicable. No person or entity is offering to sell the security as part of theOffer andtherearenolock-upagreements.

E.6 Amount andpercentage ofdilution

TheexistingissuedSharesintheCompanywillrepresent73.7%oftheenlargedordinarysharecapital of the Company immediately following completion of the Scheme and the Offer,assuming that (i) theOffer is fully subscribed at anOffer Price of 85.2p and (ii) 38,899,060SchemeSharesareissuedpursuanttotheMergerandonthatbasisShareholderswhodonotreceiveOfferSharesorSchemeShareswill,therefore,bedilutedby26.3%.TheexistingissuedSharesintheCompanywillrepresent81.8%oftheenlargedordinarysharecapital of the Company immediately following completion of the Scheme, assuming (i) theOfferdoesnotproceedand(ii)38,899,060SchemeSharesareissuedpursuanttotheMerger,andonthatbasisShareholderswhodonotreceiveSchemeShareswill,therefore,bedilutedby18.2%.TheexistingissuedSharesintheCompanywillrepresent88.2%oftheenlargedordinarysharecapitaloftheCompanyimmediatelyfollowingcompletionoftheOffer,assuming(i)theOfferisfullysubscribedatanOfferPriceof85.2pand(ii)theSchemedoesnotproceed,andonthatbasisShareholderswhodonotreceiveOfferShareswill,thereforebedilutedby11.8%.

E.7 Expensescharged to theinvestor

The anticipated cost of undertaking theMerger is approximately £331,000, including VAT,legalandprofessional fees,stampdutyandthecostsofwindingupEclipse.ThecostsoftheMergerwillbesplitproportionatelybetweentheCompanyandEclipsebyreferenceto theirrespectiveNAVsattheSchemeCalculationDate.In respect of the Offer, for all investors, the Offer Price will be determined by a formulareflecting theNAVper Share adjusted for an allowance for themajority of the costs of theOffer.Theformulais:themostrecentlyannouncedNAVperShare,dividedby0.945.AmoredetailedexplanationissetoutatE3above.InconsiderationforthepromotionandinvestmentmanagementthatOctopusprovidestotheCompany, theCompanywill pay an initial chargeof 3.0%of the gross sums invested in theOffertoOctopus.ThisispayableinthesamewayonallsubscriptionstotheOffer.FromthissumOctopuswilldischargeallexternalcostsofadviceandtheirowncosts inrespectof theOffer.Inaddition,therearethenfouroptions,whicharedeterminedbythecircumstancesofeach investor and their explicit instructions, in respect of which payments can bemade toadvisersandotherintermediaries.Theseareasfollows:1) Adirectinvestment

Investorswho have not invested theirmoney through a financial intermediary/adviserandhaveinvesteddirectlyintotheCompany.In consideration for the promotion, investment management and secretarial servicesthatOctopusprovidestotheCompany,ifanapplicationismadedirectly(notthroughanintermediary)thentheCompanywillpayOctopusanadditionalinitialchargeof2.5%ofthe investment amount and an additional annual ongoing charge of 0.5% of theinvestmentamount’slatestNAVforuptonineyears,providedtheinvestorcontinuestoholdtheShares.

2) An advised investmentwhere advice is received for an upfront feewith an ongoingadviserchargeInvestorswho have invested in theOffer through a financial intermediary/adviser andhavereceivedupfrontadviceandwillreceiveongoingadvice.The Company can facilitate a payment on behalf of an investor to anintermediary/adviser (an ‘initial adviser charge’) of up to 2.5% of the investment

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amount. If the investor has agreed with his/her intermediary/adviser to pay a lowerinitialadvisercharge,thebalance(uptoamaximumof2.5%)willbeusedfortheissueandallotmentofOfferShares for the investor, issuedat themost recentlyannouncedNAVperShare,dividedby0.945asdescribedabove.TheCompanycanalso facilitateannualpayments toan intermediary/adviser (‘ongoingadviser charges’) in respect of ongoing advisory services provided by theintermediary/adviser to the investor of up to 0.5% per annum of the investmentamount’s latest NAV for up to nine years, whilst the investor continues to hold theShares. If the investor chooses to pay their adviser less than 0.5% annually, theremainingamountwillbeusedfortheissueandallotmentofadditionalOfferSharesfortheinvestor,atthemostrecentlyannouncedNAVperShare.Anyresidualamount lessthanthecostofanOfferSharewillbedonatedtocharity.If the investor terminates his relationship with the intermediary/adviser then theCompany will not make any further payments of ongoing adviser charges to thatintermediary/adviser.TheCompanywillfacilitateongoingadviserchargesifaninvestorchangestheiradviserandconsentstotheongoingadvisercharge.

3) An advised investmentwhere advice is received for an upfront feewith no ongoingadviserchargeInvestorswho have invested in theOffer through a financial intermediary/adviser andhave received upfront advice, including investors who are investing throughintermediaries/advisersusingfinancialplatforms.Whereaninvestoragreedanupfrontfeeonly,theCompanycanfacilitateapaymentofaninitialadviserchargeofupto4.5%oftheinvestmentamount.Iftheinvestorchoosesto pay their intermediary/adviser less than the maximum initial adviser charge, theremainingamountwillbeusedfortheissueandallotmentofadditionalOfferSharesfortheinvestor,issuedatthemostrecentlyannouncedNAVperShare,dividedby0.945asdescribedabove.InthesecircumstancestheCompanywillnotfacilitateongoingannualpayments.

Inbothcases(2)or(3),shouldtheinvestorchoosetopaytheadvisermorethan2.5%or4.5%respectively, the excess amount will have to be settled by the investor directly with theadviser.4) ANon-advisedinvestmentusinganintermediary

Investorswhohaveinvestedtheirmoneythroughafinancialintermediaryandhavenotreceivedadvice.An initial commission of 2.5% of the investment will be paid by the Company to theintermediary.Anannualongoingchargeof0.5%oftheinvestmentamount’slatestNAVwillbepaidbytheCompanytotheintermediary.SuchcommissionwillbeavailableforuptonineyearsprovidedthattheintermediarycontinuestoactfortheinvestorandtheinvestorcontinuestobethebeneficialowneroftheShares.

Thesechargesmay,accordingtotheproportionofAdvisedInvestorswhereadviceisreceivedfor an upfront fee only, create some limited reduction of the NAV per Share immediatelysubsequent to subscriptions in the Offer being made. This effect will be mitigated, and isultimatelyexpectedtobemorethancompensated,forcontinuinginvestors,bytheexpectedbenefitsderivedfromalargerpoolofinvestablefundsandthefinancialbenefitinsubsequentperiodsoftheabsenceofongoingadviserchargesinrespectofsuchinvestments.

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RISKFACTORSProspective investors should consider carefully the following risk factors in addition to the other informationpresentedinthisdocument.Ifanyoftherisksdescribedbelowweretooccur,itcouldhaveamaterialeffectontheCompany’sbusiness,financialconditionorresultsofoperations.TherisksanduncertaintiesdescribedbelowaretheonlyknownmaterialriskstheCompanyortheShareholderswillface.AnydecisiontoinvestundertheOffershouldbebasedonconsiderationofthisdocumentasawhole.SchemerelatedriskfactorsCompletionof theScheme isdependentuponanumberof conditionsprecedentbeing fulfilled, including theapprovalofShareholdersandEclipseShareholders.IftheSchemeisnotapprovedand/oreffected,theexpectedbenefitsoftheSchemewillnotberealisedandtheCompanywillberesponsibleforthecostsoftheProposalsrelatingtotheScheme.Shareholdersmaybeadverselyaffectedbytheperformanceoftheinvestments,whetheracquiredfromEclipseormadebytheCompany.TheperformanceoftheinvestmentsacquiredfromEclipse,aswellastheinvestmentsof the Company,may restrict the Company’s ability following theMerger to distribute any capital gains andrevenuereceivedontheinvestmentstransferredfromEclipsetotheCompany(aswellastheinvestmentsoftheCompany).Anygains(orlosses)madeontheinvestmentsoftheCompanywill,followingtheScheme,besharedprorataamongstallShareholders.OfferrelatedriskfactorsTheOfferisconditionalontheapprovalbyShareholdersofresolution2 tobeproposedattheGeneralMeeting.IfResolution2 isnotapproved,theOfferwillbewithdrawnandtheexpectedbenefitsoftheOfferwillnotberealisedandtheCompanywillberesponsibleforthecostsoftheProposalsrelatingtotheOffer.The FinanceAct 2014 restricts income tax relief on subscription to a VCT after 5 April 2014,where,within 6months,whetherbeforeorafterthesubscription,theinvestorhaddisposedofsharesinthatVCToraVCTwhichatanytimemergeswiththatVCT.AreceiptofSchemeSharespursuanttotheMerger isnotasubscriptiontotheCompanyforthesepurposes,butShareholdersandEclipseShareholderswhohavesubscribedforsharesintheCompanyandEclipsesince5April2014shouldnotethis.RiskfactorsrelatingtotheCompanyThe past performance of the Company and/or Octopus is no indication of future performance. The returnreceivedbyShareholderswillbedependentontheperformanceoftheunderlyinginvestmentsoftheCompany.The value of such investments, and the interest income and dividends they generate,may fall and adverselyaffecttheperformanceoftheCompany.TheCompany’sinvestmentsmaybedifficult,andtaketime,torealise.Theremayalsobeconstraintsimposedonthe realisation of investments in order to maintain the VCT tax status of the Company. Both of these mayadverselyaffecttheperformanceoftheCompany.Itcantakeanumberofyearsfortheunderlyingvalueorqualityofthebusinessesofsmallercompanies,suchasthoseinwhichtheCompanyinvests,tobefullyreflectedintheirmarketvaluesandtheirmarketvaluesareoftenalsomaterially affectedby generalmarket sentiment,which canbenegative for prolongedperiods. ThismayadverselyaffecttheperformanceoftheCompany.Investmentinunquotedcompanies,byitsnature,involvesahigherdegreeofriskthaninvestmentincompanieslistedon theOfficial List. Inparticular, small companiesoftenhave limitedproduct lines,marketsor financialresourcesandmaybedependentfortheirmanagementonasmallnumberofkeyindividualsandmaybemoresusceptible to political, exchange rate, taxation and other regulatory changes. In addition, the market forsecuritiesinsmallercompaniesisusuallylessliquidthanthatforsecuritiesinlargercompanies,bringingwithitpotentialdifficultiesinacquiring,valuinganddisposingofsuchsecurities.Investmentreturnswill,therefore,beuncertainandinvolveahigherdegreeofriskthaninvestmentinacompanylistedontheOfficialList.

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WhilstitistheintentionoftheBoardthattheCompanywillcontinuetobemanagedsoastoqualifyasaVCT,there can be no guarantee that such status will be maintained. Failure to continue to meet the qualifyingrequirementscouldresultintheShareholderslosingthetaxreliefsavailableforVCTshares,resultinginadversetaxconsequencesincluding, iftheholdinghasnotbeenheldfortherelevantholdingperiod,arequirementtorepaythetaxreliefsobtained.Furthermore,shouldtheCompanyloseitsVCTstatus,dividendsandgainsarisingon thedisposal of shares in theCompanywouldbecome subject to tax and theCompanywouldalso lose itsexemptionfromcorporationtaxoncapitalgains.IfaShareholderdisposesofhisorherShareswithinfiveyearsofissue,heorshewillbesubjecttoclawbackbyHMRCofanyincometaxreliefsoriginallyclaimed.Thetaxrules,ortheir interpretation, inrelationtoaninvestment intheCompanyand/ortheratesoftaxmaychangeduringthelifeoftheCompanyandmayapplyretrospectively,whichmayadverselyaffectaninvestmentintheCompany.AnypurchaserofexistingSharesinthesecondarymarketwillnotqualifyforthethen(ifany)availabletaxreliefsaffordedonlytosubscribersofOfferSharesontheamountinvested.TheCompanywillonlypaydividendsonSharestotheextentthatithasdistributablereservesandcashavailablefor that purpose.A reduction in income from theCompany’s investmentsmay adversely affect thedividendspayable to Shareholders. Such a reduction could arise, for example, from lower dividends or lower rates ofinterestpaidontheCompany’sinvestments,orlowerbankinterestratesthanarecurrentlyavailable.TheFinanceAct2014amendedtheVCTRulesinrespectofVCTsharesissuedonorafter6April2014,suchthatVCTstatuswillbewithdrawnif,inrespectofsharesissuedonorafter6April2014,adividendispaid(orotherformsofdistributionorpaymentsaremadetoinvestors)fromsharecapitalorreservesarisingfromtheissueofshareswithinthreeyearsoftheendoftheaccountingperiodinwhichshareswereissuedtoinvestors.ThismayreducetheamountofdistributablereservesavailabletotheCompanytofunddividendsandsharebuybacks.RiskfactorsrelatingtotheSharesThe value of the Sharesmay go down aswell as up and Shareholdersmay not receive back the full amountinvested.ThevalueofSharescanfluctuateandinvestorsmaynotgetbacktheamounttheyinvested.Inaddition,thereisnocertaintythatthemarketpriceofShareswillfullyreflecttheirunderlyingNAVorthatanydividendswillbepaid,norshouldShareholdersrelyuponanySharebuybackpolicytoofferanycertaintyofsellingtheirSharesatpricesthatreflecttheunderlyingNAV.AlthoughtheexistingShareshavebeen(anditisanticipatedthattheNewShareswillbe)admittedtotheOfficialListandare(orwillbe)tradedontheLondonStockExchange’smarketforlistedsecurities,thesecondarymarketforVCTsharesisgenerallyilliquid.Therefore,theremaynotbealiquidmarket(whichmaybepartlyattributabletothefactthatinitialtaxreliefsarenotavailableforVCTsharesgenerallyboughtinthesecondarymarketandbecauseVCT shares usually trade at a discount toNAV) and Shareholdersmay find it difficult to realise theirinvestment.AninvestmentintheCompanyshould,therefore,beconsideredasalong-terminvestment.TaxreliefonsubscriptionsforsharesinaVCTisrestrictedwhere,withinsixmonths,whetherbeforeorafterthesubscription,theinvestorhaddisposedofsharesinthesameVCToraVCTwhichatanytimemergeswiththatVCT. Shareholders shouldbeaware that the saleofexistingShareswithin theseperiods could, therefore,puttheirincometaxreliefrelatingtotheOfferatrisk.

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EXPECTEDTIMETABLE,OFFERSTATISTICSANDCOSTSExpectedTimetablefortheSchemeTheCompany

LatesttimeanddateforreceiptofFormsofProxyfortheGeneralMeeting 2.30pmon8December2016

GeneralMeeting 2.30pmon12December2016

SchemeCalculationDate after5.00pmon16December2016

SchemeEffectiveDateforthetransferoftheassetsandliabilitiesofEclipsetotheCompanyandtheissueofSchemeShares

19December2016

AnnouncementoftheresultsoftheScheme 19December2016

Admissionof,anddealingsin,SchemeSharesissuedtocommence 20December2016

CRESTaccountscredited(ifapplicable) 20December2016

CertificatesforSchemeSharesdespatchedtoEclipseShareholdersWeekcommencing9January

2017

EclipseLatesttimeforreceiptofformsofproxyfortheEclipseFirstGeneralMeeting

2.30pmon5December2016

EclipseFirstGeneralMeeting 2.30pmon7December2016

LatesttimeforreceiptofformsofproxyfortheEclipseSecondGeneralMeeting

10.30amon15December2016

FinalexpecteddateoftradingoftheEclipseShares 16December2016

SchemeRecordDateforEclipse Shareholders’entitlementsundertheScheme 5.00pmon16December2016

SchemeCalculationDate after5.00pmon16December2016

DealingsinEclipse Sharessuspended* 7.30amon19December2016

Eclipse registerofmembersclosed 9.30amon19December2016

EclipseSecondGeneralMeeting

10.30amon19December2016

SchemeEffectiveDateforthetransferoftheassetsandliabilitiesofEclipse totheCompanyandtheissueofSchemeShares

19December2016

AnnouncementoftheresultsoftheScheme 19December2016

CancellationoftheEclipse Shares’listing 8.00amon20December2016

(*ThefinalexpecteddateoftradingoftheEclipseShareswillbe16December2016.SeethetimetablefortheCompanywithregardtoadmission,CRESTaccountsbeingcreditedandcertificatesbeingdespatchedinrespectoftheSchemeShares)

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ExpectedTimetablefortheOffer

LaunchdateoftheOffer 4November2016

Deadlineforreceiptofapplicationsforfirstallotment 9.00amon5January2017

FirstallotmentsundertheOffer 6January2017

Deadlineforreceiptofapplicationsforfinalallotmentin2016/17taxyear 12noonon5April2017

Deadlineforreceiptofapplicationsforfinalallotmentin2017/18taxyear 12noonon3November2017

ClosingdateoftheOffer 12noonon3November2017

• TheOfferwillcloseearlieriffullysubscribed.TheBoardreservestherighttoclosetheOfferearlierand

toacceptApplicationsandissueOfferSharesatanytimefollowingthereceiptofvalidapplications.

• TheresultsoftheOfferwillbeannouncedtotheLondonStockExchangethroughaRegulatoryInformationServiceproviderauthorisedbytheFinancialConductAuthority.

• DealingisexpectedtocommenceinOfferShareswithintenbusinessdaysofallotmentsandshareand

taxcertificatesareexpectedtobedespatchedwithin14businessdaysofallotments.

• ThedatessetoutintheexpectedtimetableabovemaybeadjustedbytheCompany,inwhicheventdetailsofthenewdateswillbenotifiedthroughaRegulatoryInformationService.

OfferStatistics

CostsofOffer Upto7.5%ofgrossproceedsofOffer

Initialadviserchargeorintermediarycommission Upto4.5%ofgrossproceedsofOffer

Ongoingadviserchargeorannualongoingcharge

Upto0.5%perannumofthelatestNAVofgrosssumsinvestedintheOfferforupto9years

• ThecostoftheOfferiscappedat7.5%.OctopushasagreedtoindemnifytheCompanyagainstthecostsoftheOfferinexcessofthisamount.

LoyaltyDiscount

Investorswhoareexisting,orwhowerepreviously,shareholdersofanyOctopusVCTwillbenefitfromthecostsoftheOfferbeingreducedby1.0%.ThisreductionwillbemetbyOctopusthroughanequivalentreduction inthecostsofOfferfeereferredtoabove.

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LETTERFROMTHECHAIRMAN

OctopusApolloVCTplc

33HolbornLondon

EC1N2HT

4November2016

DearInvestor,Withnetassetsof£152.1millionat31July2016,OctopusApolloVCTplcisoneofthelargestVCTsintheUK,bringingnumerousbenefitstobothourshareholdersandthesmallercompaniesweback.TheCompanyaimstoprovideinvestorswithregulartax-freedividendsthroughitsportfolioofestablishedUKsmallercompaniesandbymakingnewinvestmentsinyoungercompanieswithaprovencommercialtrackrecord.An investment under the Offer will provide individuals with exposure to a diversified portfolio of unquotedsmallercompanieswiththeaimofgeneratingaregularstreamoftaxfreedividends.Newinvestorswillbenefitfromimmediateexposuretoalarge,establishedVCTwithanexistingportfolioofaround33investmentsacrossarangeofsectors.OverthetwodecadessinceVCTswereintroduced,successivegovernmentshaveshowncontinuedsupportforthescheme,buthaveadjustedtherulessurroundingVCTinvestmenttoensurethatVCTmoneycontinuestobedirectedwhereitisneededthemost.Asinvestorswillbeaware,overthelast18months,theGovernmenthasenactedsignificantchangestotherulessurroundingVCTinvestments.FortheCompanythechangeswillhavenoimpactontheexistingportfolio,howevernew investmentswillhavetobemade intocompanies thatare lessthan seven years old from their first commercial sale, which is typically younger than has been the casepreviously.TheCompanyhasalsohistoricallybenefittedfromtheManager'sexpertiseintheenergysector,withcurrent energy generating assets of approximately £23.7 million in the portfolio today. Since April 2016, nofurtherinvestmentsinenergygenerationhavebeenpermitted.

Whilst these new rules create more complexity for the Manager to deal with, we remain confident in theinvestment team's ability to find suitable companies for the Company’smandate,with attractive positions intheirmarketsandagoodcommercialtrackrecord.ItisagainstthisbackdropthattheBoardhasannouncedthatitintendstoraiseafurther£20millionunderanewshareoffer.TheManagerintendstocontinueinvestingviaacombinationofbothdebtandequitytoensurethattheCompanyreceivesaregularincomefromloaninterestand repayments that enable the Company to pay investors regular tax-free dividends. By investing in acompany’s debt, aswell as its shares, there is a greater chance that the Companywill get some or all of itsmoneyback ifabusinessdoesn’tsucceed.TheequityholdingalsoallowstheCompanytobenefitfromcapitalgrowthiftheunderlyingcompaniesperformwell.AllVCTs invest insmaller,unquotedcompaniesthatcarryagreaterriskof losingmoneythantheir largerbluechip counterparts. Within the bounds of VCT legislation, the Company aims to invest in more established,profitableVCTqualifyingcompanieswiththeaimofprovidingaregularstreamoftaxfreedividendstoinvestors.

TheManagertypicallylooksforthefollowingattributeswhenmakinganewinvestment:

• Anestablishedandsuccessfulmanagementteamwithastrongtrackrecordatthecompany• Aprovencommercialtrackrecord• Abroadcustomerbaseandhighlevelsofrepeatbusiness

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• Acompetitiveadvantageovercompetitorsthatreducestheriskoflosingcustomers

At the point of investmentmost of the companies the Company supports are already generating profits butrequirefundingtounlockfurthergrowth.SowhilsttheCompanyisprovidingmuchneededdevelopmentfinancetothesecompanies,thereislesspotentialforvolatilitythantheremightbeinearlierstagecompanieswhichareyettodevelopadiversecustomerbaseorpredictablerevenuestreams.Theinvestmentteamhasaproactiveapproachtowardsseekingnewopportunitiesviadesk-basedresearchandthroughcontactsintheaccountancy,privateequityandcorporatefinancecommunity.Theyseealargevolumeofpotential transactionswhichtheyevaluatetosee if theymaysuit theCompany’s investmentmandate.Theinvestment team uses a rigorous screening and due diligence process, including commissioning independentadvisory firms to supplement the researchundertakenby the team. Investments also require theapprovalofvariousindependentcommitteeswithinOctopus,aswellastheBoard.Aswellasproducinginvestmentreturns,theCompany'sportfolioisalsoactivelyaidingthegrowthofUKsmallercompanies,akeyfactorintheGovernment’scontinuedsupportoftheventurecapitaltrustindustry.TheBoardbelieves that the portfolio iswell positioned to continue delivering a regular stream of tax free dividends tothoseinvestorsabletotakealong-termviewoninvestinginwell-runUKsmallercompanies.TheMergerOctopusEclipseVCTplcwaslaunchedinMarch2004andovertimehasevolvedtoasimilarinvestmentmandatetothatoftheCompany.Whenlaunched, itmadesensetohaveseveralseparateVCTs investingalongsideoneanother due to the VCT rules in force at the time. Today, the rationale for having multiple small VCTs hasdisappeared and changes to Merger Regulations in September 2004 subsequently allowed VCTs to mergewithoutaffectingtheirVCTstatus.Sincethen,anumberofVCTshavetakenadvantageofthenewregulationstocreatelarger,moreefficientVCTs,aswhenOctopusApollo1,2,3&4mergedintothecurrentOctopusApolloVCTplc.Incommonwithmostcompanies,VCTshaveanumberoffixedcoststhattheyhavetoincuraspartoftheirdaytodayactivities.Aspubliccompanies,VCTsaresubjecttolistingcosts,registrarcosts,auditcostsaswellasthecostsoftheirnon-executivedirectors,allofwhichwouldbemoreefficientbeingsplitacrossalargerassetbase.Inadditiontothecostsavings,havingalargerVCTwithamorediversesetofholdingsgivestheManagermoreflexibility on how it manages the portfolio within the VCT Rules as well being able to maximise investmentopportunitiesandfacilitatebetterliquiditymanagementforShareholders.With the above inmind, on 27 September 2016, the Board and the Eclipse Board announced that they hadenteredintodiscussionstoconsideramergeroftheCompaniestocreateasingle,largerVCTwiththeintentionofimprovingShareholdervalue.TheMergerisexpectedtodeliveranumberofadditionalbenefitstoShareholdersincluding:

• participationinalargerVCTwithamorediversifiedportfolio,therebyspreadingtheportfolioriskacrossabroaderrangeofinvestments;

• efficiencies in annual running costs and administration for the Enlarged Company compared to theseparatecompanies;

• enhancingtheabilityoftheEnlargedCompanytofindhighqualitynewinvestments,raisefunds,aswellaspaydividendsandsupportbuybacksinthefuture.

TheproposalistomergetheCompaniesusingaschemeofreconstruction(the“Scheme”)bywhichtheassetsandliabilitiesofEclipsewillbetransferredtotheCompany.TheSchemewill,ifeffectedandassumingtheOfferisfullysubscribed,resultinanEnlargedCompanythatwillbe

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one of the biggest VCTs in the UK. Post-merger, the Enlarged Company is targeting an annual tax-free 5%dividendyield.Taxfreespecialdividendsmayalsobepayableifinvestmentsaresoldforasignificantprofitfromtheportfolio.PerformanceThe diverse portfolio of investee companies continues to perform well and the Company has a strong trackrecordof converting investmentperformance into tax-freedividends for investors. Since31 January2016, theManagerhasdeliveredonanumberofstrongexits,returningaround£26.8millionbacktotheCompany.TheseincludeCallstream,ProjectTristar,SCMWorld,CSLDualcomandAtlanticScreenInternationalandhaveenabledtheCompanytoannounceaspecialdividendof16.5pperShare,inadditiontotheregulardividendof2.5pperShare,tobepaidon2December2016.Thefullfiveyearperformancehistoryisshownbelow: Yearto

31July2016Yearto

31July2015Yearto

31July2014Yearto

31July2013Yearto

31July2012

Performance(Totalreturnincludingdividends)

Company 2.3% 2.0% 5.3% 0.9% 6.7%

Eclipse 0.9% -4.1% 24.3% 1.6% -8.2%

TheperformanceinformationaboveshowsthetotalreturnoftheCompanyandEclipseforthelastfiveyearsto31 July. The annual total return is calculated from themovement in NAV over the year to 31 July, with anydividendspaidoverthatyearthenaddedback.TherevisedfigureisdividedbytheNAVatthestartofthatyeartogettheannualtotalreturn.Performanceshownisnetofallfeesandcosts.Pastperformanceisnotareliableindicatoroffutureresultsandmaynotberepeated.Pleasenote,theNAVperSharemaybehigherthantheShareprice,whichisthepriceyoumaygetfortheSharesinthesecondarymarket.DividendsanddividendPolicyFollowing payment of the special and regular dividendon 2December 2016, it is expected that theNAVpershareoftheVCTwill fallby19p.TheintentionoftheBoard istocontinuetargetingpaymentofanannual5%dividendyieldashasbeenthecasesincethemergerofthefourApolloVCTsinSeptember2012.BasedoffthereducedNAVpershareweexpecta5%dividendyieldtoequatetoapaymentofroughly3pperyear,distributedto shareholders through two 1.5p dividends. This is a reduction from the current 5p per share per year, butremainsconsistentwithourhistoricdividendpayments,preservingthetargeted5%yield.TheOfferTheOfferisintendedforinvestorslookingforaVCTthataimstoprovidearegularstreamoftaxfreedividendsbyinvestinginprofitableVCTqualifyingsmallercompaniesthroughacombinationofdebtandequity.InvestorswillbenefitfromimmediateexposuretoanestablishedVCTwithaportfolioofaround33investments.The Company is seeking to raise up to £20million under theOfferwhich is conditional upon the passing byShareholdersofResolution2attheGeneralMeetingtobeheldat2.30pmon12December2016at33Holborn,LondonEC1N2HT.Iwould like to thankallofourexistingShareholders for theirenduring supportof theCompanyand theUK'ssmallbusinesses.IlookforwardtomeetingyouattheGeneralMeetinginDecember.

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YourssincerelyMurraySteeleChairmanOctopusApolloVCTplc

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PARTONE:THESCHEME

TheScheme ConditionsoftheSchemeTermsoftheSchemeShareCertificates,MandatesandListing Taxation TheSchemeThemechanismbywhichtheMergerwillbecompletedisasfollows:

• Eclipse will be placed into members’ voluntary liquidation pursuant to a scheme of reconstructionunderSection110IA1986;and

• all of the assets and liabilities of Eclipsewill be transferred to the Company in consideration for theissueofSchemeShares.

The Scheme will be completed on a relative unaudited NAV basis, adjusted for the anticipated costs of theScheme,rollingintotheSchemeSharesattheRoll-OverValue.TheMergerValueandtheRoll-OverValuewillbebasedon the latest unaudited valuations of theCompanies' investments. An accounting firmwill review thelatest unaudited NAVs of the Companies and valuations of the Companies’ investments prior to the SchemeEffectiveDateandwillconfirmthattheyhavebeenpreparedinaccordancewithsimilarprinciplesaswouldhavebeenused inproducingyearendaccounts.TheeffectoftheSchemewillbethattheEclipseShareholderswillreceiveShareswiththesametotalnetassetvalueasattheSchemeCalculationDateastheirEclipseShares.TheSchemeisconditionalupontheapprovalbytheShareholdersofResolution1tobeproposedattheGeneralMeetingandbytheEclipseShareholdersoftheResolutionstobeproposedattheEclipseGeneralMeetings,aswellastheotherconditionssetoutbelow.AstheCompanyandEclipsehaveasimilarinvestmentobjectiveandpolicy,thesameinvestmentmanagerandother common advisers, theMerger should be achievablewithoutmajor additional cost or disruption to theCompanyandEclipseandtheircombinedportfolioofinvestments.TheaggregateanticipatedcostofundertakingtheMerger isapproximately£331,000, includingVAT, legalandprofessionalfees,stampdutyandthecostsofwindingupEclipse.TheLiquidatorsfeesincludedinthisfigureareexpectedtobeupto£15,000.ThecostsoftheMergerwillbesplitproportionatelybetweentheCompanyandEclipsebyreferencetotheirrespectiveNAVsattheSchemeCalculationDate.

ShareholdersshouldnotethattheMergerwillbeoutsidetheprovisionsoftheCityCodeonTakeoversandMergers.

As is required by CA 2006, prior to the allotment of the Scheme Shares, the Company will be sending toShareholders and Eclipse Shareholders at their registered addresses and uploading on to Octopus’ website areportontheMergerwhichwillbepreparedbyScott-Moncrieff.TheportfolioofassetswhichwillbetransferredfromEclipsetotheCompanyaspartoftheSchemeareallconsideredtobeinkeepingwiththeCompany’sinvestmentpolicy,particularlyasanumberofthesearecommon across the respective portfolios of the Company and Eclipse. The extent of the liabilities (ifany)whichwillbetransferredfromEclipsetotheCompanyaspartoftheSchemewillbethosewhichare incurred in theordinarycourseofbusinessandmergercostswhich remainunpaidat thetimeoftransfer.Anysuchliabilitiesareexpectedtobenominalincomparisontothevalueoftheassets.Eclipse Shareholders who do not vote in favour of the resolution to be proposed at the Eclipse FirstGeneralMeetingareentitledtodissentandhavetheirshareholdingpurchasedbytheLiquidatorsataprice agreed between the dissenting Eclipse Shareholders and the Liquidators (or by arbitration),whichwouldbeexpectedtobeatasignificantdiscounttothenetassetvalueofanEclipseShare.Iftheconditions of the Scheme are not satisfied, the Companies will continue in their current form and the

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BoardswillcontinuetoreviewalloptionsavailabletothemregardingthefutureoftheCompanies.ClearancehasbeenrequestedfromHMRCthattheSchememeetstherequirementsoftheMergerRegulationsand,therefore,thattheimplementationoftheSchemeshouldnotaffectthestatusoftheCompanyasaVCT.ItistheintentionoftheBoardtocontinuetocomplywiththerequirementsofITA2007followingtheMergersothattheCompanycontinuestoqualifyasaVCT.

Further informationregardingthetermsoftheSchemeissetout inPartOneofthisdocument.DetailsoftherisksrelatingtotheSchemeandthosegenerallyassociatedwith investing inaVCTaresetoutonpages15to16ofthisdocument.FollowingthetransferoftheassetsandliabilitiesbyEclipsetotheCompany,thelistingoftheEclipseShareswillbecancelledandEclipsewillbewoundup.ConditionsoftheSchemeTheSchemeisconditionalupon:

• thepassingofResolution1tobeproposedattheGeneralMeeting;• noticeofdissentnothavingbeenreceivedfromEclipseShareholdersholdingmorethan10%innominal

valueoftheentireissuedsharecapitalofEclipseunderSection111ofIA1986;• thepassingoftheResolutionstobeproposedattheEclipseGeneralMeetings;and• HMRCapprovaloftheMergerontermssatisfactorytotheCompany.

Subjecttotheabove,theSchemewillbecomeeffectiveimmediatelyafterthepassingofthespecialResolutionforthewindingupofEclipsetobeproposedattheEclipseSecondGeneralMeeting.Ifitbecomeseffective,theSchemewillbebindingontheShareholdersandEclipseShareholders(includingdissentingEclipseShareholders)andallpersonsclaimingthroughorunderthem.TermsoftheSchemeOn the Scheme Effective Date, the Liquidators will receive all the cash, undertakings and other assets andliabilitiesofEclipseandwilldelivertotheCompany:

• particularsofalloftheassetsandliabilitiesofEclipse;• alistcertifiedbytheregistrarsofthenamesandaddressesof,andthenumberofEclipseSharesheldby

eachoftheEclipseShareholdersontheregisterat5.00pmontheSchemeRecordDate;• anestimateofthewinding-upcostsofEclipse;and• theamountestimatedtoberequiredtopurchasetheholdingsofanydissentingEclipseShareholders.

On the Scheme Effective Date, the Company and the Liquidators (on behalf of Eclipse) will enter into theTransferAgreementpursuanttowhichtheLiquidatorswillprocurethetransferofalloftheassetsandliabilitiesof Eclipse to the Company in exchange for the issue of Scheme Shares (credited as fully paid) to the EclipseShareholdersonthebasissetoutbelow.In furtherconsiderationof such transferofassetsand liabilitiesofEclipse to theCompany, theCompanywill,pursuanttotheTransferAgreement,undertaketopayallliabilitiesincurredbytheLiquidatorsincluding,butnotlimited to, the implementation of the Scheme, the winding up of Eclipse and the purchase for cash of anyholdingsofdissentingEclipseShareholders.Except asotherwiseprovided for in the Scheme terms, for thepurposesof calculating theMergerValue, theRoll-Over Value and the number of Scheme Shares to be issued, in order that the Eclipse Shareholders willreceiveShareswiththesametotalnetassetvalueasattheSchemeCalculationDateastheirEclipseShares,thefollowingprovisionswillapply:MergerCalculationsRoll-OverValueTheRoll-OverValuewillbecalculatedas:

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A–(B+C)Dwhere:A = theunauditednet assets of Eclipse as at the SchemeCalculationDate (taken from the Eclipse unauditedmanagementaccountstothatdate),plusorminusanyadjustmentthatboththeBoardandtheEclipseBoardconsiderappropriatetoreflectanyotheractualorcontingentbenefitorliabilityofEclipse;B=thecostsoftheSchemetobeapportionedtoEclipse(byreferencetotheRoll-OverValueandtheMergerValue,butignoringmergercosts),plus£1,000(representinganamountofcontingencytocoveranyunforeseenadditionalcostsattributabletoEclipseincurredbytheCompany,whichwillindemnifytheLiquidatorsinrespectofallcostsofEclipsefollowingthetransferontheSchemeEffectiveDate);C = the amount estimated to be required to purchase the holdings of Eclipse Shares from dissenting EclipseShareholders;andD=thenumberofEclipseSharesinissueasatcloseofbusinessontheSchemeRecordDate(saveforanyEclipseSharesheldbydissentingEclipseShareholders).MergerValueTheMergerValuewillbecalculatedas:E–FGwhere:E = theunauditednet assetsof theCompanyas at the SchemeCalculationDate (taken from theCompany'sunauditedmanagement accounts to that date), plusorminus any adjustment that theBoard and the EclipseBoardconsiderappropriatetoreflectanyotheractualorcontingentbenefitorliabilityoftheCompany;F= the costsof theScheme tobeapportioned to theCompany (by reference to theRoll-OverValueand theMergerValue,butignoringmergercosts);andG=thenumberofSharesinissueasatcloseofbusinessontheSchemeRecordDate.SchemeSharestobeissuedtoEclipseShareholdersThenumberofSchemeSharestobeissuedtoEclipseShareholders(saveforanydissentingEclipseShareholders)willbecalculatedasfollows:HxJIwhere:H=theRoll-OverValue;I=theMergerValue;andJ=thenumberofEclipseSharesinissueasatcloseofbusinessontheSchemeRecordDate(saveforanyEclipseSharesheldbydissentingEclipseShareholders).TheSchemeShareswillbeissueddirectlytoEclipseShareholders(disregardingEclipseSharesheldbydissentingEclipseShareholders),ineachcaseproratatotheirexistingholdingsofEclipseSharesontheinstructionoftheLiquidators.

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ThemergerratiosusedtoallocatetheSchemeSharestoeachEclipseShareholderwillberoundeddowntosixdecimal places and entitlements will be rounded down to the nearest whole number and any fractionalentitlementsperEclipseShareholder(whichwillnotexceed£2)willbeaggregatedandsold,withtheproceedsretainedforthebenefitoftheEnlargedCompany.

TheCompanywillnot issuetheSchemeSharesuntil thereportpreparedbyScott-MoncrieffunderCA2006 inrespectoftheSchemehasbeenprovidedtotheCompanyandsenttoShareholdersandEclipseShareholders.

BasedontheformulaeabovebutusingNAVsof80.5pand31.5pfortheCompanyandEclipserespectively,beingthe latestpublishedunauditedNAVsof theCompaniesasat thedateof thisdocumentandafter subsequentdividendpayments,0.391304SchemeShareswouldhavebeenissuedtoEclipseShareholdersforeveryEclipseShareheld(assumingnodissentingEclipseShareholders)hadtheMergerbeencompletedon3November2016.

ShareCertificates,MandatesandListingWhereEclipseShareholdersholdtheirEclipseSharesincertificatedform,theywillreceiveanewcertificateforthe Scheme Shares issued.Where Eclipse Shareholders hold their Eclipse Shares in uncertificated form, theirCRESTaccountswillbecreditedwiththeholdinginSchemeShares.TheCompanyoperatesadividendreinvestmentscheme(the“DRIS”).IfEclipseShareholdersbecomeholdersofSharesandwouldliketoparticipateintheDRIStheymaydosobycontactingCapitaAssetServices,TheRegistry,34 Beckenham Road, Beckenham, Kent BR3 4TU no later than 15 Business Days before the payment of adividendbytheCompany.TheDRISwillapplytoaShareholder’sentireholdingofSharesandparticipationintheDRIScanbecancelledatanytimewithwrittenauthorityfromtheShareholder.ThetermsandconditionsoftheDRISarealsosetoutattheendofthisdocument.AnapplicationhasbeenmadetotheUKLAfor theSchemeSharestobe issuedpursuanttotheSchemetobelisted on the premium segment of the Official List andwill bemade to the London Stock Exchange for suchSchemeSharestobeadmittedtotradingonitsmarketforlistedsecurities.Fromthedateofissue,theSchemeShareswillrankparipassuwitheachother.TaxationThefollowingparagraphsapplytotheCompanyandtopersonsholdingSharesasaninvestmentintheCompanywhoaretheabsolutebeneficialownersofsuchSharesandareresidentintheUK.Theymaynotapplytocertainclasses of persons, such as dealers in securities. The following information is based on current UK law andpractice,issubjecttochangestherein,isgivenbywayofgeneralsummaryanddoesnotconstitutelegalortaxadvice.Ifyouareinanydoubtaboutyourposition,orifyoumaybesubjecttotaxinajurisdictionotherthantheUK,youshouldconsultyourindependentfinancialadviser.TheCompanyandShareholdersTheimplementationoftheSchemeshouldnotaffecttheVCTreliefsobtainedbyShareholdersonsubscriptionforexistingShares.TheimplementationoftheSchemeshouldnotaffectthestatusoftheCompanyasaVCT.Itisthe intention of the Board to continue to comply with the requirements of ITA 2007 so that the CompanycontinuestoqualifyasaVCT.EclipseShareholdersThereceiptbyEclipseShareholdersofSchemeSharesshouldnotconstituteadisposaloftheirEclipseSharesforUK tax purposes. Eclipse Shareholders should, for UK tax purposes, effectively be able to treat the SchemeShares received as if they had been acquired at the same cost and on the same date as the original EclipseSharesfromwhichtheyderive(butallocatedproportionatelybetweensuchresultingSchemeShares).AnyinitialincometaxreliefobtainedandattachingtotheoriginalEclipseShareswillnot,therefore,besubjecttoclawbackasaresultoftheMerger,butinsteadwillthenattachtotheSchemeShares.AstheCompanyisalsoaVCT,theusualVCT tax reliefs should continue toapply.Asa result,qualifyingShareholders should continue to receivetax-free dividends and should not be subject to UK taxation on any capital gains on the disposal of SchemeSharesprovidingtheyareheldfortheusualVCTminimumholdingperiod.

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For Eclipse Shareholdersholding (togetherwith their associates)more than5%of theEclipse Shares in issue,clearancehasbeenobtainedfromHMRCintermsofSection138ofTCGA1992thatthetaxtreatmentdescribedaboveforpersonswho(togetherwiththeirassociates)ownlessthan5%oftheEclipseSharesshouldalsoapplytothem.Eclipse Shareholderswhodonot vote in favourof theResolution tobeproposedat theEclipse FirstGeneralMeeting are entitled to dissent and have their shareholding purchased by the Liquidators at a price agreedbetweenthedissentingEclipseShareholdersandtheLiquidators(orbyarbitration),whichisexpectedtobeatasignificantreductiontothenetassetvalueofanEclipseShare.Inaddition,EclipseShareholdersshouldnotethatapurchaseofEclipseSharesbytheLiquidatorsfromadissentingEclipseShareholderwillberegardedasadisposalofsuchEclipseSharesfortaxpurposes,therebytriggeringtherepaymentofanyincometaxrebateonEclipseSharessubscribedforinthefiveyearspriortopurchase.Thesalepricereceivedmaynotbesufficienttocovertheamountofpaymentdue.AlthoughtheCompanywillberequiredtopayUKstampdutyorstampdutyreservetaxonthetransfertoitofthe assets and liabilities of Eclipse (which form part of themerger costs), no UK stamp dutywill be payabledirectlybyShareholdersasaresultoftheimplementationoftheScheme.ClearancehasbeenobtainedfromHMRCinrespectoftheSchemeunderSection701ITA2007confirmingthatthereceiptofSchemeSharesshouldnot,exceptinthecaseofdealers,beregardedasanincomereceiptforthepurposesofUKtaxation.Clearance has also been requested from HMRC to confirm that the Schememeets the requirements of theMergerRegulationsandthat,assuch,thereceiptbyEclipseShareholdersofSchemeSharesshouldnotprejudicetax reliefsobtainedby thoseEclipse Shareholdersonexisting Eclipse Shares and shouldnotbe regardedas adisposal.The Finance Act 2014 restricts income tax relief on subscription to a VCT after 5 April 2014where,within 6months(beforeorafter),theinvestorhaddisposedofsharesinthatVCToraVCTwhichatanytimemergeswiththatVCT.A receiptof SchemeSharespursuant to theMerger isnota subscription to theCompany for thesepurposesbutShareholderswhohavesubscribedforsharesintheCompanyorEclipsesince5April2014shouldnotethis.

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PARTTWO:THEOFFER

IntroductiontotheOffer TermsoftheOffer UseofFunds IntermediaryCharges InvestmentPolicyTaxBenefitsforInvestors DividendPolicyandDividendReinvestmentScheme BuybackPolicy TheBoard TheInvestmentTeam ManagementRemunerationInvestmentProcessPerformanceHistoryExampleInvestmentsMergerPlansConflictsofInterest

IntroductiontotheOffer

VCTs were introduced by the UK Government in 1995 to encourage individuals to invest in UK smallercompanies. According to theAssociationof InvestmentCompanies (AIC),almost£458millionwas invested inVCTsinthe2015/2016taxyear,thelargestamountforadecade.

An investment under the Offer will provide individuals with exposure to a diversified portfolio of unquotedsmallercompanieswiththeaimofgeneratingreturnsoverthemediumto long-term.ThenetproceedsoftheOfferwillbeinvestedinaccordancewiththeCompany’sinvestmentpolicy,assetoutbelow.TheCompanyisseekingtoraise£20millionundertheOffer.BothnewandexistinginvestorscanapplyforOfferShares,whichwill rankequallywith theexistingShares.As such,all investorsareaccessingawell-establishedportfolio.TheOfferPricewillbebasedonthemostrecentlypublishedNAVofaShareatthedateofallotment.Multipleapplicationsarepermitted.Theminimuminvestment is£5,000.There isnomaximuminvestment.However,potential investorsshouldbeawarethattaxreliefisonlyavailableonamaximuminvestmentof£200,000ineachtaxyear.Amarriedcouple,caninvestupto£200,000eachinanyonetaxyearwithbothindividualsbenefitingfromthetaxreliefs.TheOfferisconditionaluponthepassingbyShareholdersofResolution2attheGeneralMeeting.TermsoftheOfferThefulltermsandconditionsapplicabletotheOfferaresetoutonpages83to88.UseoffundsTheaggregatenetproceedsoftheOffer,assuminga£20 millionsubscriptionandthemaximuminitialcharge,willbe£18.5million.ThefundsraisedundertheOfferwillbeinvestedinaccordancewiththeCompany’sinvestmentpolicy.SomeofthefundsraisedwillbeusedtoinvestintonewportfoliocompaniesandsomewillbeusedtofurthersupporttheCompany’sexistingportfolio.

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IntermediaryCharges

DetailsaresetoutintheTermsandConditionsoftheOfferonpages83to88.

InvestmentPolicyTheCompany'sInvestmentPolicyisasfollows.The Company’s investment policy is designed to enable the Company to comply with the VCT qualifyingconditions. It is intendedthatthe long-termdispositionoftheCompany’sassetswillbenot lessthan80%inaportfolio of unquoted investments and up to 20% in cash or near cash investments to provide a reserve ofliquiditywhichwillmaximisetheCompany’sflexibilityastothetimingofinvestmentacquisitionsanddisposals,dividendpaymentsandsharebuybacks.Investmentsarestructuredusingvariousunquoted investment instruments, includingordinaryandpreferenceshares,loanstocksandconvertiblesecurities,toachieveanappropriatebalanceofincomeandcapitalgrowth,having regard to the venture capital legislation. The portfolio is diversified by investing in a broad range ofindustry sectors and by holding investments in companies at various stages of maturity in the corporatedevelopment cycle, though investments are not generally made in early stage companies which have yet toachieve profitability and cash generation. The normal investment period is in the range from three to sevenyears.Anyuninvestedfundsaretypicallyheldincashandmoneymarketfunds.Riskisspreadbyinvestinginanumberofdifferentbusinesseswithindifferentindustrysectorsusingavarietyofsecurities.ThemaximumamountinvestedinanyonecompanyislimitedtoanyHMRCannualinvestmentlimitsand,generally,nomorethan15%oftheCompany’sassets,atcost,areinvestedinthesamecompany.The value of individual investments is expected to increase over time as a result of trading progress and acontinuousassessment ismadeof investments’ suitability forsale.TheCompany’sVCTqualifying investmentsareheldwithaviewtolong-termcapitalgrowthaswellasincomeandwilloftenhavelimitedmarketability;asaresultit ispossiblethatindividualholdingsmaygrowinvaluetothepointwheretheyrepresentasignificantlyhigher proportion of total assets prior to a realisation opportunity being available. Investments are normallymadeusingshareholders’fundsanditisnotintendedthattheCompanywilltakeonanylong-termborrowings.TaxBenefitsforInvestorsVCTsareGovernment-led investmentvehiclesdesignedto incentivise investors forsupportingsmaller,higher-risk companies. Qualifying investors are entitled to claim a number of tax incentives on investments up to£200,000eachtaxyear(asmorefullysetoutinPartThreeofthisdocument).Theseinclude:

• Income tax relief – investors can claim30%upfront income tax relief on the amount invested, providedSharesareheldforatleastfiveyears.Forexample,withaninvestmentof£10,000,£3,000canbetakenoffyourincometaxbillalthoughtheamountofincometaxyouclaimcannotexceedtheamountofincometaxdue.

• Tax-freedividendsandcapitalgains-meaningthatanygrowthintheportfoliovalueisnotsubjecttotax.

DividendPolicyandDividendReinvestmentScheme

VCTsareabletomakedividendpaymentsfromdistributablereserves.ThesedistributionsarenotsubjecttoanyfurthertaxtoQualifyingSubscribers.InordertoqualifyasaVCT,theCompanymaynotretainmorethan15%oftheincomeitreceivesfromsharesandsecurities.

The amount of these dividends depends, amongst other things, on the level of income and capital returnsgeneratedbytheQualifying Investments, theperformanceof thenon-Qualifying Investmentsandtheamount

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raisedbytheOffer.Inthemediumtolong-termthesizeofdividendspaidtoShareholderswilldependlargelyonthelevelofprofitsrealisedfromthedisposalofinvestments.

TheCompanyistargetingaregularannualdividendof3pperShareperannuminordertoretainitshistoric5%dividendyield.TheCompanyhasadoptedaDividendReinvestmentSchemeunderwhichShareholdersaregiventhe opportunity to reinvest future dividend payments by way of subscription for new Shares. Subject to aShareholder’spersonalcircumstances,Sharessubscribed forunder theDividendReinvestmentSchemeshouldobtaintheusualVCTtaxadvantagesassetoutabove.

Investors under the Offer may elect to participate in the Dividend Reinvestment Scheme by completing thedividend reinvestment section of theApplication Form, and should be aware that itwill apply to their entireholding of New Shares and any existing Shares. Participation in the Dividend Reinvestment Scheme by aShareholdercanbecancelledatanytimewithwrittenauthorityfromtheShareholderorbycallingOctopuson08003162295.

BuybackPolicy

The Board also intends to continue to consider repurchasingSharesfollowingthemergerofupto14.99%ofitsenlargedsharecapitalforthepurposesofthegeneral buyback policy. The Board believes that it is in thebest interests of the Company and the ShareholderstomakeoccasionalmarketpurchasesoftheShares, toallowanyShareholderswhoneed toselltheirSharestodosoandtoreducetoadegreeanydiscounttoNAVinthe current market price than might otherwise prevail. The Board will agree the discount to NAV at whichShareswillbeboughtbackand regularly reviews thebuybackpolicy.TheBoard’scurrentpolicyistobuybacksharesata5%discounttoNAV.

AnyfuturerepurchaseswillbemadeinaccordancewithguidelinesestablishedbytheBoardfromtimetotimeandwillbesubjecttohavingtheappropriateauthoritiesfromShareholdersandsufficientfundsavailableforthispurpose.AllbuybacksaresubjecttothediscretionoftheBoard.Theremay,however,beperiodsduringayearwheretheCompanywillbeprohibitedfrombuyingbackSharesandwhichmayincludetheperiodsofuptofourmonthsafter its financialyearendanduptothreemonthsafter itshalfyearend.SharebuybackswillalsobesubjecttotheListingRulesandanyapplicable lawattherelevanttime.Sharesboughtback inthemarketwillordinarilybecancelled.

TheBoard

TheBoardcomprisesfourdirectorswhoareindependentofOctopus.TheDirectorsoperateinanon-executivecapacity and are responsible for overseeing the investment strategy of the Company. The Board has wideexperienceofinvestmentinbothsmallergrowingcompaniesandlargerquotedcompanies.

MurraySteele(Chairman)

Murraywas appointed as Director and Chairman on completion of themerger of Octopus Apollo VCT 1 plc,OctopusApolloVCT2plcandOctopusApolloVCT4plcwith theCompany.Murrayhashadabroad rangeofexperienceasaDirectorofanumberof companies.Atpresenthe isChairmanof LINX– theLondon InternetExchange, SurfaceGeneration Limited, a hi-techengineering company, andanon-executivedirectorof JamesWalker Group, an international engineering groupwith revenues of £200million.Murray has Bachelor’s andMaster’sdegrees inmechanicalengineering fromtheUniversityofGlasgow,anMBAfromCranfieldSchoolofManagementandholdsanaccountingqualification.MurraywasformerlyadirectorofOctopusApolloVCT4plcwhichwasplacedintoMembersVoluntaryLiquidationon28September2012followingthemergeroftheApolloVCTsandwasdissolvedon15April2014.

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ChristopherPowles

ChriswasappointedasaDirectoron28September2012uponthemergerofOctopusApolloVCT1plc,OctopusApollo VCT 2 plc andOctopus Apollo VCT 4 plcwith the Company. Chris has extensive experience in theUKsmallercompaniessector.HewastheprincipalfounderofPiCapital,aprivateclientfundmanagementcompanythatspecialisesininvestinginsmallerunquotedcompanies.PriortosellinghisstakeinPiCapitalin2002heledthe investment ofmore than £25million into 14 companies. Subsequently hewas the finance director of anAIM-tradedcompany,aswellasanon-executivedirectorofboth listedandprivatecompanies.Currentlyhe isinvolvedinrenewableenergy,beingadirectorofthreecompaniesinthatsector.Chrisisacharteredaccountant,havingqualified atwhat is nowpart of PricewaterhouseCoopers LLP, andhas aBAHonsdegree fromOxfordUniversity.ChriswasformerlyadirectorofOctopusApolloVCT4plcwhichwasplacedintoMembersVoluntaryLiquidationon28September2012followingthemergeroftheApolloVCTsandwasdissolvedon15April2014.

JamesOtter

JameswasformerlyChairmanofOctopusVCTplcandbecameaDirectoruponthemergerofOctopusVCTplcandtheCompanyinNovember2014.JameswasalsoadirectorofHygeaVCTplc,whichspecialisesininvestingin early stagebioscience companies.Hehad led severalHygea investees as CEO.He is currentlyworkingonprojectsinthegrowingareaofhealthIT.PreviouspositionsincludebeingamainboarddirectorofSpectrisplc,workingonaturnaroundprojectinDenmark,andadirectorofGlidePharmaceuticalTechnologiesLimited.ThebulkofhiscareerwasspentininternationalcommercialroleswithZenecaAgrochemicals(formerlyICIandnowSyngenta).JameshasanMBAfromINSEADandadegreeinNaturalSciencesfromCambridge.

IanPearson

Ian was formerly Chairman of Octopus VCT 2 plc and was appointed as a Director on 27 January 2016, oncompletionofthemergerofOctopusVCT2withtheCompany.Heworksinstrategyandbusinessdevelopment.HeisaNon-ExecutiveDirectoratThamesWater,ChairmanofCodeInvestingandamemberofPwC’sAdvisoryBoard.Untilstandingdownbeforethegeneralelectionin2010,Ianhadovernineyears’experienceataseniorlevelingovernment,includingimportantrolesasMinisterforClimateChangeandtheEnvironment,MinisterforTrade,Minister for Science and Innovation and aMinister inNorthern Ireland. As Economic Secretary to theTreasury from2008 – 2010, Ianwas at the heart of theUK’s response to the global financial crisis. Amongstother things, hewas responsible for growth, enterprise andproductivity issues, the EUBudget,wherehe lednegotiations for theUK,Public/PrivatePartnerships includingPrivateFinance Initiative, and InfrastructureUK.Priortohisgovernmentalcareer, Ianwas jointchiefexecutiveofWMEBGroup,providingventureandgrowthcapitaltoSMEsandconsultancytoarangeofpublicandprivateclients.

In theeventthat theMergerproceeds,AlexHambrowill jointheBoardoncompletionof theMergerand IanPearsonwillstepdownfromtheBoardon31January2017.AlexHambroAlexhasbeenChairmanofEclipseVCTplc since1February2014havingbeenappointedasadirectorof thatcompanyon1November2012.Hewasanon-executivedirectorofOctopusEclipseVCT4plc.Alexhasspentthelast25yearsintheventurecapitalandprivateequitysector,muchofthistimeatHambrosplcandassociatedorganisations. As a director of Hambro Group Investments, he was responsible for the establishment andoperationsoftheHambroPrivateEquityGroup,whichsponsoredninefundmanagersintheUK,Europe,theUSandAustralia. Since leavingHambros in 1999, hehas assisted several venture capital organisationswith theirfundraisingandmarketingprogrammesandhasactedasaconsultanttoanumberofinvestorsontheirventurecapital investmentstrategies.Alex isChairmanof JudgesScientificPlcandBenchmarkHoldingsPlcandanon-executivedirectorofaportfolioofprivatecompanies.

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TheInvestmentTeamOctopus Investments Limited was launched in 2000 by three founders whowanted to create an investmentcompany that put its customers first. Today it hasmore than440employees and£5.8billion in assets undermanagement (Source:Octopus investmentsLimited,August2016). Ithas tensof thousandsof clientsandhasbuilt market-leading positions in tax-efficient investment, smaller company financing, renewable energy andhealthcare.OctopuslauncheditsfirstVCTin2002andisnowtheUK’slargestVCTmanager,managingover£600millionofVCTmoneyonbehalfofover25,000investors(Source:OctopusInvestmentsLimited,August2016).Members of the team are frequently appointed as non-executive directors and sit on the boards of thecompaniestheyworkwith.Thisallowsthemtoplayaprominentroleineachcompany’songoingdevelopment,and ensures the team can closely monitor the company’s progress while offering continued support to thebusiness.

TheCompany'sinvestmentteamissupportedbytheOctopusInvestmentCommittee,whichprovidesafurtherlayer of independent challenge and insight to the team’s investment decisions. The Committee is formed ofseniorinvestmentprofessionalsthatareindependentoftheCompany'sinvestmentteam.

TheCompany'sinvestmentteamcomprises:GrantPaul-Florence,InvestmentDirector

Granthasoverelevenyearsofexperienceinprivateequityandventurecapitalinvestingacrossawiderangeofindustry sectors. He has held a variety of non-executive directorships and is currently a board observer forClifford Thames Group and Care Monitoring and Management. Grant has operational experience, havingpreviouslybeenheadofcorporatedevelopmentofaspecialist logisticsbusiness.He isacharteredaccountantandworkedinthecorporatefinanceteamatPricewaterhouseCoopersinLondon.

IanPotter,InvestmentDirector

IanjoinedOctopusin2013andisresponsibleformakingnewinvestments,monitoringportfoliocompaniesandfundraising. Ian is currently a non-executive Director for ISG, TSC and Vista Retail Support. Before joiningOctopus, Ian spent over 8 years in leveraged finance at The Royal Bank of Scotland, including experience inoriginationandstructuring,portfoliomanagementandrestructuringactivity.IanalsoworkedatErnst&YoungintheTransactionAdvisoryServicesgroupandisaqualifiedcharteredaccountant.

EdwardKeelan,InvestmentManager

EdwardjoinedOctopusin2008andisresponsibleformakingnewinvestments,monitoringportfoliocompaniesand fundraising. He has non-executive director experience in the power industry and distribution sector andcurrently sitson theboardofCountrywideHealthcareSuppliesandAngloEuropean.Prior toOctopusEdwardwaswithKorteQ,asmallbusinessconsultancyspunoutofRolls-Royce.

ClaraHansen,InvestmentAssociate

Claraisresponsiblefor identifyingandanalysinginvestmentopportunitiesaswellassupportingtheteamwithdeal execution and portfolio monitoring. She is currently a board observer for Care Monitoring andManagement. Clara has over five years of investment banking and venture capital experience across Paris,LondonandHongKong.

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CharlesStreet,InvestmentAnalyst

Charlesisresponsibleforidentifyingandscreeninginvestmentopportunitiesandsupportingtheteamwithdealexecutionandportfoliomanagement.Charles joinedOctopus fromCambridgeUniversityBusinessSchoolandhaspreviouslyworkedatHSBCInvestmentBank.

ManagementRemuneration

FulldetailsoftheManager'sremunerationaresetoutatparagraph8.5ofPartSeven.

InvestmentProcess

TheCompany's investment teamuses severaldifferentapproaches to find suitablecompanies to invest in.Aswellasconductingitsownresearch,theteamregularlytalkstocompaniesthatspecialiseinfindingorprovidingfinancingforsmallandmedium-sizedbusinesses.Thishelpstoidentifyfundinggapsincompaniesthatcouldsuitthe Company's investment mandate. Much of this work is driven by forming strong relationships, so thereputationoftheteam,andtheperformancetrackrecordoftheCompany,areimportantfactors.Investmentsareusuallystructuredaspartloanandpartequity.ThishelpstoensurethattheVCT:• Receivesa regular income from loan interestand repayments thatenable theCompany topay investors

regulartax-freedividends.Byinvestinginacompany’sdebt,aswellasitsshares,there’sagreaterchancethattheCompanywillgetsomeorallofitsmoneybackifthebusinessdoesn’tsucceed.

• Canalsobenefitfromcapitalgrowthwhentheinvestmentteamsellstheequitystakeithasinabusiness.ThismeanstheCompanycanparticipateinthevaluecreatedbythecompanyifitgrows.

This combinationofdebtandequity investmenthelpsensure theVCTcontinues togeneratea stable, regularincome.TheequitycomponentenablestheVCTtobenefitfurtheriftheunderlyingcompaniesperformwell.Theinvestment team uses a rigorous screening and due diligence process, including commissioning independentadvisory firms to supplement the researchundertakenby the team. Investments also require theapprovalofvariousindependentcommitteeswithinOctopus,aswellastheBoard.Tomaintain its focusonprovidinga stable, regular tax-free income,wherepossible the investment teamwillremainfocusedonfindingcompaniesthatdisplaythefollowingcharacteristics:

• Anestablishedandsuccessfulmanagementteamwithastrongtrackrecordatthecompany• Aprovencommercialtrackrecordandhistoryofgeneratinggoodannualprofits• Abroadcustomerbaseandhighlevelsofrepeatbusiness• AcompetitiveadvantageovercompetitorsthatreducestheriskoflosingcustomersPerformanceHistorySince its launch in 2006, the Company has built a strong track record of paying regular tax-free dividends,targetinganannualyieldof5%.OneofthemainbenefitsofVCTsistheirpotentialforpayingtax-freedividendstoinvestors.TheCompanypaiditsfirstdividendin2008andbyAugust2016hadpaidoutatotalof35pperSharetoinvestors.Aswell as regular tax-freedividends, theCompany's investors couldalsopotentiallybenefit fromtheir sharesincreasinginvalueovertheyears.AslongastheSharesareheldforatleastfiveyears,there’snocapitalgainstax to pay when you eventually choose to sell them. Please remember, past performance is not a reliableindicatoroffutureresultsandthevalueofSharescanfallaswellasrise.

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Five-yearperformanceYearto31July 2012 2013 2014 2015 2016Annualtotalreturn 6.7% 0.9% 5.3% 2.0% 2.3%Annualdividendyield 5.6% 4.9% 5.7% 5.8% 3.0%*

*Duetothefinaldividendfortheyearto31January2016onlybeingpaidinAugust2016,thedividendyieldat31July2016isbelowthetargetof5%.Includingthisdividendtheannualyieldto31July2016wouldbe6.0%.TheperformanceinformationaboveshowsthetotalreturnoftheCompanyforthelastfiveyearsto31July,theVCT’s interimaccountingperiod.TheannualtotalreturnfortheCompany iscalculatedfromthemovement inNAV over the year to 31 July,with any dividends paid over that year then added back. The revised figure isdividedbytheNAVatthestartofthatyeartogettheannualtotalreturn.TheNAVisthecombinedvalueofalltheassetsownedbytheVCTafterdeductingthevalueofitsliabilities(suchasdebtsandfinancialobligations).Performanceshownisnetofallongoingfeesandcosts.TheannualdividendyieldiscalculatedbydividingthedividendspaidperyearbytheNAVatthestartoftheperiod.Pastperformanceisnotareliableindicatoroffutureresultsandmaynotberepeated.Pleasenote,theNAVpersharemaybehigherthantheShareprice,whichisthepriceyoumaygetfortheSharesontheopenmarket.

ExampleInvestments-Commercialcompanieswithacompetitiveedge

CliffordThames:enablingcarmakerstosellreplacementpartsClifford Thames is a key partner to some of the world’s leading motor manufacturers. They depend on theChelmsford-basedcompany’ssoftware,consultancyandbusinessoutsourcingexpertisetoenabledealershipstosell replacement parts. Customers include Ford,GMEurope, Jaguar Land Rover,Mercedes-Benz and Renault.GlobalexpansionhasseenCliffordThamesopenofficesintencountries.Thedataitssoftwarecapturesisusedby customers in over 160 countries. The company is an attractive investment for the Company because itsrevenuestreamsarerecurring,sotheyarelikelytobemorestableandpredictable.TheBoardisimpressedbyitsprovenmanagementteam,longtradinghistoryandexcellentcustomerservice.“Octopusfirst investedinusin2010andquicklydevelopednotonlyafirmgraspofthebusiness,butalsoaveryclose,openandhonestrelationship.WehighlyvaluethesupportandstrategicadvicethatOctopushasbroughttothecompanyandthelongtermpartnershipwehavecreated.”CalvinBarnett,chiefexecutiveofficer,CliffordThamesCountrywideHealthcareSupplies:keepingcarehomeswellstockedCountrywideHealthcareSuppliesisa‘one-stopshop’suppliertotheUK’srapidlygrowingcarehomesector.Thecompany specialises in delivering awide range of healthcare and cleaning products, aswell as furniture andbedding. From its 80,000 square foot distribution centre in South Yorkshire, Countrywide servesmanyof thebiggestnames intheUKcarehome industry.Thecompanywassetupby four formerNationalHealthServiceworkcolleaguesandnowemploysover60people.TheBoardwasattracted toCountrywideby its strongandrecurring revenues. TheBoard thinks the companyhas a good focus on customer service,with high levels ofcustomerretentioncreatingrepeatbusinessopportunities.“Itwas clear the teamatOctopus knewexactlywhatwewere looking to achieveatCountrywide, and thepotentialforgrowththatcouldberealised.Octopussharesourvision,theyunderstandthemarketandtheyareasenthusiasticandcommittedtodeliveringhighqualitycustomerserviceasweare.”AlastairKitching,managingdirector,CountrywideISGTechnology:Offeringend-to-endwirelessconnectivityforUKretailersISGdesignsandinstallswirelessnetworksystemsforlargemulti-siteretailerssuchasTesco,NextandSelfridges,aswellasotherpublicandprivatesectorcustomersacrosstheUK.Itisabletorapidlydeliverlargeandreliablesystems,providingWi-Ficonnectionsusedbyemployeesandinsystemsthatimprovethecustomerexperience

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orrecordcustomerbuyinghabits.Thesesystemsarecriticaltoabusinessandthereforemustbeinstalledwithlittleornodisruption to customers.Becauseof its strongexpertise, ISG is often contracted todo thedesign,installationandon-goingmaintenance.ThebusinesshasheadquartersinSurreyandfiveservicedeliverycentresacrosstheUK. Italsorunsatechnicalservicecentre inBulgaria.TheBoardwasattractedbythemanagementteam’simpressivetrackrecordandthehighqualityservicepropositionofthebusinessinagrowingmarket.“WeareverypleasedtohavethefinancialbackingofOctopus,andenjoyworkingwiththeteam.Wefelttheybroughtaflexibleandcreativeapproachtothefinancingofthebusiness,andwelookforwardtocontinuingtogrowthebusinesswiththem.”MikeMorrison,chiefexecutiveofficer,ISGTechnologyCMM:MonitoringsoftwareforremoteworkforcesIt’simportantforcareandfacilitymanagementcompaniestobeabletokeeptrackoftheirremoteemployees,especially if theyworkatmultiple locations.Homevisitsbycarecompanies, inparticular,arebecomingmorepopular.CustomerslikeSaga,Mitie,ServestandseveralUKcouncilsuseCMM’sremoteworkforcemanagementsoftwaretomonitorthetimeandattendanceoftheirworkersaswellastheoutcomeofthecareprovided.TheBoardisexcitedbythisinvestmentbecauseCMMisagrowingbusinesswithcontractedrecurringrevenuesinafast-growing sector. The care market is expanding rapidly to meet the increasing demands of an ageingpopulation,withmorepeople lookingforcare intheirownhomesfor longer.TheBoardbelievesCMMiswellpositionedtoexpandfurther,bothintheUKandoverseas.“Whilstwehavehadmanyotherpotential investorscontactusoverthepast fewyearstherehasonlyeverbeenonethatweseriouslyconsidered.Octopusrecognisethechallengesfacedbyowner/managersandthisisoneofthereasonswhywefelttheirexpertisewouldgetustothenextlevel.”PeterLongman,groupchiefexecutiveofficer,CMMMergerplans

Aswellasraisingnewfunds,theCompanyisalsoproposingtomergewithEclipse.TheinvestmentstrategiesoftheCompanyandEclipsehavebecomecloselyalignedovertime.Bothhaveinvestedsuccessfullyalongsideoneanother in some of the same companies, and believe combining the two VCTs is in the best interests ofShareholdersforthefollowingreasons:• Greaterportfoliodiversity-CombiningtheportfoliosoftheCompanieswouldcreatea largerportfolioof

companies, expanding the Company's current range of investments. This would instantly create amorediversifiedportfolioofaround62companiesforinvestors.

• Economiesofscale-ThecostsofrunningtheEnlargedCompanywillbelowerthanthecostsofrunningtwo

separateVCTs.Thereareanumberof fixedcoststhateveryVCTmustpay, includingregistrar fees,auditand accountancy fees and salaries for the board of directors for example. In addition, every year theCompaniesarelegallyrequiredtosendeveryShareholderandEclipseShareholderdifferentsetsofreportsandaccounts.IftheMergerisagreedtheEnlargedCompanywouldbeabletosendShareholdersonesinglereporteachtime.ForinvestorsintheCompany,spreadingthesefixedcostsoveralargermergedVCTwillbebeneficial.

After the merger, Shareholders would be invested in a well-diversified VCT portfolio featuring an expandednumber of companies from a larger number of investment sectors. They would own shares in a VCT ofsignificant size and strength, making it one of the largest VCT in the UK, according to the Association ofInvestmentCompanies(Source:AssociationofInvestmentCompanies:24October2016).The investment approach taken by Eclipse is similar to that of the Company. Both Companies target stablereturnsandpaymentofaregulardividendbyinvestinginQualifyingInvestmentsinUKsmallercompaniesthatare operating in various sectors andmaking a positive contribution to the UK economy in terms of tax andemployment.

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ConflictsofinterestOctopus has built strong relationships with many of the companies in which the Company invests, andsometimes uses different sources of funding to invest in the same companies. This can present ‘conflicts ofinterest’, as explained below. With these relationships, there’s a chance that the interests of one group ofinvestors will be at odds, or present a conflict, with the interests of another group or with the interests ofOctopus. Conflicts of interest arenot aproblem in themselves andOctopusmanages themcarefully tomakesurethatinvestorsaretreatedfairlyatalltimes.The Company's investment team will usually invest funds from the Company along with funds from otherOctopus-managed products and sometimes even Octopus itself. Through this co-investment, investors in theCompanycanhaveaccesstodealsthatmaynothavebeenpossiblewithoutbeingpartofthelargerdealwithotherOctopusinvestors.The Company often places an Octopus employee on the board of the companies it invests in, either as anobserveroradirector.ThismeanstheCompanyisabletocloselymonitortheinvestmentwe’vemadeonbehalfof the Company's investors. It does, however, mean that as company directors, those employees haveobligationstoallshareholdersofthecompany,andnotjusttheCompany'sinvestors.SometimestheCompanyisunabletoinvestasmuchmoneyasitwouldlikeduetorestraintssuchasthesizeofacompany or the number of shares available. In these instances, the amounts being invested from differentOctopus vehicles must be managed carefully. Similarly, when investments held by a number of differentinvestorscometobesold,theinterestsofallpartiesmaynotbefullyaligned.TheCompanyhasagreedpoliciesand processes in place tomake sure this is done fairly, but sometimes, investorsmay still be limited in theamountstheycaninvestorrestrictedinthetimingofanexit.OctopusmayreceivefeesfromthecompaniesthattheCompanyinvestsin(forexample,whenmakingorsellinganinvestmentinacompany,aswellasforappointingarepresentativetotheboardofdirectors).Suchfeesdonot typically exceed1.5%annuallyof the total amount investedbyallOctopusmanaged funds (including theCompany).Thistypicalfeeisbasedonaninvestmentof£5millionandaholdingperiodoffiveyears.Thecostsofall deals that donot proceed to completion are typically borneby either the company seeking funding or byOctopus.Octopushasanumberofcontrolsinplacetomanageconflictsofinterestonbehalfofinvestors:•The InvestmentCommitteemakessure investmentdecisionsare in thebest interestsof investors, includinghowpotentialconflictsofinterestaremanaged.• Incaseswheretherearea largenumberofconflictsof interestortheyareparticularlysignificant,proposalsarereviewedbytheConflictsCommittee,whichisresponsibleforensuringconflictsarehandledappropriately.• As the Company is a publicly listed company, the Board is required to act independently and representShareholders’bestinterestsatalltimes.

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PARTTHREE:TAXPOSITIONOFSHAREHOLDERS,ECLIPSE SHAREHOLDERSANDINVESTORSUNDERTHEOFFER

GeneralThefollowingparagraphsapplytotheCompanyandtoindividualsholdingSharesasaninvestmentwhoaretheabsolutebeneficialownersofsuchSharesandwhoareresidentintheUK.Theymaynotapplytocertainclassesofindividuals,suchasdealersinsecurities.ThefollowinginformationisbasedoncurrentUKlawandpractice,issubjecttochangestherein,isgivenbywayofgeneralsummaryanddoesnotconstitutelegalortaxadvice.Ifyouareinanydoubtaboutyourposition,orifyoumaybesubjecttotaxinajurisdictionotherthantheUK,youshouldconsultyourfinancialadviser.ThetaxreliefssetoutbelowrelatingtotheOfferareavailabletoindividualsaged18oroverwhoreceiveOfferSharesundertheOfferandwheretheOfferSharesacquiredarewithintheinvestor’sannual£200,000limit.Thereliefsarenotavailableforinvestmentsinexcessof£200,000pertaxyear.TheCompanyhasobtainedapprovalasaVCTunderChapter3ofPart6ITA2007.The Board considers that the Company has conducted its affairs, andwill continue to do so, to enable it toqualifyasaVCT.TheSchemeClearancehasbeenobtainedfromHMRCinrespectoftheSchemeunderSection701ITA2007confirmingthatthereceiptofSchemeSharesshouldnot,exceptinthecaseofdealers,beregardedasanincomereceiptforthepurposesofUKtaxation.ClearancehasbeenrequestedfromHMRCtoconfirmthattheSchememeetstherequirementsoftheMergerRegulationsandassuch thereceiptbyEclipseShareholdersofSchemeSharesshouldnotprejudice tax reliefsobtainedbytheEclipseShareholdersonexistingEclipseSharesandshouldnotberegardedasadisposal.TheimplementationoftheSchemeshouldnotaffecttheVCTreliefsobtainedbyShareholdersonsubscriptionforexistingShares.TheimplementationoftheSchemeshouldnotaffectthestatusoftheCompanyasaVCT.ItistheintentionoftheBoardtocontinuetocomplywiththerequirementsofITA2007soastocontinuetoqualifyasaVCT.TaxPositionofEclipse ShareholdersThereceiptbyEclipseShareholdersofSchemeSharesshouldnotconstituteadisposaloftheirEclipseSharesforUK tax purposes. Eclipse Shareholders should, for UK tax purposes, effectively be able to treat the SchemeSharesreceivedpursuanttotheSchemeasiftheyhadbeenacquiredatthesamecostandonthesamedateastheoriginalEclipseSharesfromwhichtheyderive(butallocatedproportionatelybetweensuchresultingSchemeShares).AnyinitialincometaxreliefobtainedandattachingtotheoriginalEclipseShareswillnot,therefore,besubjecttoclawback,butinsteadwillthenattachtotheSchemeShares.AstheCompanyisalsoaVCT,theusualVCTtaxreliefsshouldcontinuetoapply.Asaresult,qualifyingShareholdersshouldcontinuetoreceivetax-freedividendsandshouldnotbesubjecttoUKtaxationonanycapitalgainsonthedisposalofSchemeShares.For Eclipse Shareholdersholding (togetherwith their associates)more than5%of theEclipse Shares in issue,clearancehasbeenobtainedfromHMRCintermsofSection138ofTCGA1992thatthetaxtreatmentdescribedaboveforpersonswho(togetherwiththeirassociates)ownlessthan5%oftheEclipseSharesshouldalsoapplytothem.Eclipse Shareholderswhodonot vote in favourof theResolution tobeproposedat the Eclipse FirstGeneralMeeting are entitled to dissent and have their shareholding purchased by the Liquidators at a price agreedbetweenthedissentingEclipseShareholdersandtheLiquidators(orbyarbitration),whichisexpectedtobeatasignificantreductiontothenetassetvalueofanEclipseShare.Inaddition,EclipseShareholdersshouldnotethatapurchaseofEclipseSharesbytheLiquidatorsfromdissentingEclipseShareholderswillberegardedasadisposalofsuchEclipseSharesfortaxpurposes,therebytriggeringtherepaymentofanyincometaxrelief

38

onEclipseSharessubscribedforinthefiveyearspriortopurchase.Thesalepricereceivedmaynotbesufficienttocovertheamountofpaymentdue.AlthoughtheCompanywillberequiredtopayUKstampdutyorstampdutyreservetaxonthetransfertoitofcertainoftheassetsofEclipse(whichformpartofthemergercosts),noUKstampdutywillbepayabledirectlybyShareholdersasaresultoftheimplementationoftheScheme.Eclipse ShareholdersnotresidentintheUKEclipse ShareholdersnotresidentintheUKshouldseektheirownprofessionaladviceastotheconsequencesofmakingandholdinganinvestmentintheCompany,astheymaybesubjecttotaxinotherjurisdictionsaswellasintheUK.TaxPositionofInvestorsundertheOfferThetaxreliefssetoutbelowarethosecurrentlyavailabletoindividualsaged18oroverwhosubscribeforOfferSharesundertheOfferandwillbedependentonpersonalcircumstance.Whilstthereisnospecificlimitontheamountofanindividual’sacquisitionofsharesinaVCT,taxreliefswillonlybegiventotheextentthatthetotalofanindividual’ssubscriptionsorotheracquisitionsofsharesinVCTsinanytaxyeardonotexceed£200,000.Qualifyinginvestorswhointendtoinvestmorethan£200,000inVCTsinanyonetaxyearshouldconsulttheirprofessionaladvisers.TaxBenefitsforVCTinvestors1.IncomeTax1.1InitialIncomeTaxreliefAninvestorcanacquireOfferSharesofuptoamaximumof£200,000undertheOfferineachof2016/17and2017/18taxyears.Thereliefissubjecttoanamountwhichreducestheinvestor’sincometaxliabilityforthetaxyear to nil. Each application creates an entitlement to income tax relief of 30%of the amount invested. ToretainthatrelieftheOfferShareshavetobeheldfor5years.Thetablebelowhasbeenpreparedforillustrativepurposesonlyanddoesnotformpartofthesummaryofthetaxreliefscontained inthissection.Thetableshowshowthe initial incometaxreliefavailablecanreducetheeffectivecostofaninvestmentof£10,000inaVCTtoonly£7,000,byaqualifyinginvestorsubscribingforVCTshares: Effectivecost TaxreliefInvestorunabletoclaimanytaxreliefs £10,000 NilVCTinvestorabletoclaimfull30%incometaxrelief £7,000 £3,000

Tax relief on subscriptions for shares in a VCT is restricted where, within six months (before or after) thatsubscription,theinvestorhaddisposedofsharesinthesameVCToraVCTwhichatanytimemergeswiththatVCT.ExistingShareholdersshouldbeawarethatthesaleofexistingShareswithintheseperiodscould,therefore,puttheirincometaxreliefrelatingtotheOfferatrisk.1.2DividendreliefDividendspaidonordinarysharesinaVCTarefreeofincometax.VCTstatuswillbewithdrawnif,inrespectofsharesissuedonorafter6April2014,adividendispaid(orotherformsofdistributionorpaymentsaremadetoinvestors)fromthecapitalreceivedbytheVCTfromthatissuewithinthreeyearsoftheendoftheaccountingperiodinwhichshareswereissuedtoinvestors.DividendspaidfromrealisedprofitsmaybemadewithoutlossofVCTstatus.

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1.3WithdrawalofreliefRelief from income tax on a subscription for VCT shareswill bewithdrawn if the VCT shares are disposed of(other than between spouses) within five years of issue or if the VCT loses its approval within this period.DividendreliefisnotavailablefordividendspaidinanaccountingperiodduringwhichtheVCTlosesitsapproval.2.CapitalGainsTax2.1RelieffromcapitalgainstaxonthedisposalofVCTsharesDisposingofaVCTshareataprofitdoesnotcreateachargeablegainforthepurposesofUKCapitalGainsTax.Similarly,disposingatalossdoesnotcreateanallowablelossforUKCapitalGainsTax.3.WithdrawalofapprovalIf a companywhichhasbeengrantedapproval as aVCT subsequently fails to complywith the conditions forapprovalasaVCT,approvalmaybewithdrawnortreatedasneverhavingbeengiven. Inthesecircumstances,reliefs from income tax on the initial investment are repayable unless loss of approval occursmore than fiveyearsaftertheissueoftherelevantVCTshares.In addition, relief ceases to be available on any dividend paid in respect of profits or gains in an accountingperiodduringorafterwhichVCTstatushasbeenlost.AnygainsontheVCTsharesuptothedatefromwhichlossofVCTstatusistreatedastakingeffectwillbeexempt,butgainsthereafterwillbetaxable.4.Othertaxconsiderations4.1ObtaininginitialtaxreliefsTheCompanywillprovideeach investorwithataxcertificatewhichthe investormayusetoclaim incometaxrelief.Todothis,aninvestormusteitherobtainataxcodingadjustmentfromHMRCunderthePAYEsystem,orwaituntiltheendofthetaxyearandusetheirselfassessmenttaxreturntoclaimrelief.4.2ShareholdersnotresidentintheUKShareholdersnotresidentintheUKshouldseektheirownprofessionaladviceastotheconsequencesofmakingandholdinganinvestmentintheCompany,astheymaybesubjecttotaxinotherjurisdictionsaswellasintheUK.5.TaxPositionoftheCompanyAVCThastosatisfyanumberofteststoqualifyasaventurecapitaltrust.Asummaryofthesetestsissetoutbelow.5.1QualificationasaVCTToqualifyasaventurecapitaltrust,acompanymustbeapprovedassuchbyHMRC.Tomaintainapproval,theconditionssummarisedbelowmustcontinuetobesatisfiedthroughoutthelifeoftheVCT:

(i) theVCT’sincomemusthavebeenderivedwhollyormainlyfromsharesandsecurities(inthecaseofsecuritiesissuedbyacompany,meaningloanswithafive-yearorgreatermaturityperiod);

(ii) no holding in a company (other than a VCT or a companywhichwould, if its shareswere listed,

qualifyasaVCT)bytheVCTmayrepresentmorethan15%,byvalue,oftheVCT’stotalinvestmentsatthetimeofinvestment;

(iii) theVCTmustnothaveretainedmorethan15%oftheincomederivedfromsharesorsecuritiesin

anyaccountingperiod;

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(iv) the VCT must not be a close company. Its ordinary share capital must be listed on a regulated

Europeanmarketbynolaterthanthebeginningoftheaccountingperiodfollowingthatinwhichtheapplicationforapprovalismade;

(v) atleast70%,byvalue,ofitsinvestmentsisrepresentedbysharesorsecuritiescomprisingQualifying

Investments;(vi) for funds raised before 6 April 2011, have at least 30%, by value, of its Qualifying Investments

representedbyholdingsofordinary shareswhichcarrynopresentor futurepreferential rights todividends,returnofcapitaloranyredemptionrights;

(vii) forfundsraisedafter5April2011,haveatleast70%,byvalue,oftheVCT’sQualifyingInvestments

in“eligibleshares”,thatisordinaryshareswhichcarrynopreferentialrightstoassetsonawindingupandnorightstoberedeemedalthoughtheymayhavecertainpreferentialrightstodividendssolongasthatrightisnon-cumulativeandisnotsubjecttodiscretion;

(viii) notmakeaninvestmentinacompanywhichcausesthatcompanytoreceivemorethan£5millionof

StateAidinvestmentinthe12monthsendedonthedateoftheinvestment;(ix) notreturncapitaltoshareholdersbeforethethirdanniversaryoftheendoftheaccountingperiod

duringwhichthesubscriptionforsharesoccurs.

(x) noinvestmentcanbemadebytheCompanyintoacompanywhichcausesthatcompanytoreceivemorethan£12million(£20millionifthecompanyisdeemedtobeaKnowledgeIntensiveCompany)ofStateAidinvestment(includingfromVCTs)overthecompany’slifetime.AsubsequentacquisitionbythecompanyofanothercompanythathaspreviouslyreceivedStateAidRiskFinancecancausethelifetimelimittobeexceeded;

(xi) noinvestmentcanmadebytheCompanyinacompanywhosefirstcommercialsalewasmorethan

7yearspriortodateof investment,exceptwherepreviousRiskFinanceStateAidwasreceivedbythecompanywithin7years(10yearsforaKnowledgeIntensiveCompany)orwhereaturnovertestissatisfied;

(xii) no funds received from an investment into a company can be used to acquire another existing

businessortradeorprovideareturnofcapitaltooneofitsshareholders;and(xiii) theVCTmustnotmakeanon-Qualifying Investmentotherthanthosespecified insection274 ITA

2007.“Qualifying investments” comprise shares or securities (including loans with a five year or greatermaturity period but excluding guaranteed loans and securities) issued by unquoted trading companieswhichexistwhollyormainlyforthepurposeofcarryingononeormorequalifyingtrades.Thetrademustbecarriedonby,orbeintendedtobecarriedonby,theinvesteecompanyoraqualifyingsubsidiaryatthe time of the issue of the shares or securities to the VCT (and by such company or by any othersubsidiary in which the investee company has not less than a 90% interest at all times thereafter). Acompany intending to carryon aqualifying trademustbegin to tradewithin two yearsof the issueofsharesor securities to theVCTandcontinue it thereafter. Thedefinitionof aqualifying tradeexcludesdealing in property, shares, securities, commodities or futures. It also excludes banking, insurance,receivingroyaltiesorlicencefeesincertaincircumstances,leasing,theprovisionoflegalandaccounting

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services, farming and market gardening, forestry and timber production, property development,shipbuilding, coal and steel production, operating or managing hotels or guest houses, generation ofelectricity,powerorheat,nursingandresidentialcarehomes.Thefundsraisedbytheinvestmentmustbeusedforthepurposesofthequalifyingtradewithincertaintimelimits.Aqualifying investment canalsobemade ina companywhich is aparent companyofa tradinggroupwheretheactivitiesofthegroup,takenasawhole,consistofcarryingononeormorequalifyingtrades.Investee companies must have a permanent establishment in the UK. The investee company cannotreceive more than £5 million from VCTs or other State Aid investment sources during the 12 monthperiodwhichendsonthedateoftheVCT’s investment. The investeecompany’sgrossassetsmustnotexceed £15 million immediately prior to the investment or £16 million immediately thereafter. Theinvesteecompanymusthave fewer than250employeesor500employees in thecaseofaKnowledgeIntensiveCompany.NeithertheVCTnoranyothercompanymaycontroltheinvesteecompany.Atleast10%oftheVCT’stotalinvestmentintheinvesteecompanymustbeineligibleshares,asdescribedabove.The company cannot receive more than £12 million (£20 million if the company is deemed to be aKnowledge Intensive Company) of State Aid investment (including from VCTs) over the company’slifetime.Thecompany’sfirstcommercialsalemustbenomorethan7yearsbeforetheVCT’sinvestment(10 years for aKnowledge IntensiveCompany)prior to thedateof investment, exceptwherepreviousRiskFinanceStateAidwasreceivedbythecompanywithin7yearsorwhereaturnovertestissatisfied.Funds received from an investment by a VCT cannot be used to acquire another existing business ortrade.Companies whose shares are traded on AIM are treated as unquoted companies for the purposes ofcalculatingqualifying investments.Shares inanunquotedcompanywhichsubsequentlybecomes listedmay still be regarded as a qualifying investment for a further five years following listing, provided allotherconditionsaremet.

5.2TaxationofaVCTVCTsareexemptfromcorporationtaxonchargeablegains.ThereisnorestrictiononthedistributionofrealisedcapitalgainsbyaVCT,subjecttotherequirementsofcompanylaw.VCTswillbesubjecttocorporationtaxontheirincome(excludingdividendsreceivedfromUKcompanies)afterdeductionofattributableexpenses.

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PARTFOUR:PROFORMAFINANCIALINFORMATION ACCOUNTANT’SREPORTONTHEPROFORMAFINANCIALINFORMATION TheDirectorsOctopusApolloVCTPLC6thFloor33HolbornLondonEC1N2HTHowardKennedyCorporateServicesLLPNo1LondonBridgeLondonSE19BG

4November2016

DearSirsOctopusApolloVCTPLC(“theCompany”)ProformafinancialinformationWereportontheproformafinancialinformation(the"ProformaFinancialInformation")setoutinPartAandPartBofPartIVoftheprospectusdated4November2016(the“Prospectus”)ofOctopusApolloVCTPLC,whichhasbeenpreparedon thebasisdescribed in thenotes to theProFormaFinancial Information, for illustrativepurposesonly,toprovideinformationabouthowtheMergerandtheOffer(asdefinedintheProspectus)mighthave affected the financial information presented on the basis of the accounting policies adopted by theCompanyinpreparingthefinancialstatementsforthesixmonthsending31July2016.Thisreportisrequiredbyitem20.2ofAnnexIoftheCommissionRegulation(EC)No.809/2004(the“PDRegulation”)andisgivenforthepurposeofcomplyingwiththatitemandfornootherpurpose.Saveforanyresponsibilityarisingunderparagraph20.2ofAnnexIofAppendix3.1.1oftheProspectusRulestoanypersonasandtotheextentthereprovided,tothefullestextentpermittedby lawwedonotassumeanyresponsibilityandwillnotacceptanyliabilitytoanyotherpersonforanylosssufferedbyanysuchotherpersonasaresultof,arisingoutof,orinconnectionwiththisreportorourstatement,andgivensolelyforthepurposesof complyingwith paragraph 20.2 of Annex I of Appendix 3.1.1 of the Prospectus Rules, or consenting to itsinclusionintheProspectus.ResponsibilitiesIt is the responsibility of the directors of the Company (the “Directors”) to prepare the Pro Forma FinancialInformationinaccordancewithitem20.2ofAnnexIofthePDRegulation.Itisourresponsibilitytoformanopinion,asrequiredbyitem7ofAnnexIIofthePDRegulation,astothepropercompilationoftheProFormaFinancialInformationandtoreportthatopiniontoyou.Save foranyresponsibilityarisingunderProspectusRule5.5.3R(2)(f) toanypersonasandtotheextent thereprovided,tothefullestextentpermittedbythelawwedonotassumeanyresponsibilityandwillnotacceptanyliability toanyotherperson forany loss sufferedbyanysuchotherpersonasa resultof,arisingoutof,or inconnectionwith this report or our statement,which are included, in the formand context inwhich they are

43

included,withourconsentandwithourhavingauthorisedthecontentsofthisPartFour,requiredbyandgivensolelyforthepurposesofcomplyingwithitem23.1ofannex1ofthePDRegulation.Inprovidingthisopinionwearenotupdatingorrefreshinganyreportsoropinionspreviouslymadebyusonanyfinancial information used in the compilation of the Pro Forma Financial Information, nor do we acceptresponsibilityforsuchreportsoropinionsbeyondthatowedtothosetowhomthosereportsoropinionswereaddressedbyusatthedatesoftheirissue.BasisofopinionWe conducted our work in accordance with the Standards for Investment Reporting issued by the FinancialReportingCouncil in theUnitedKingdom.Theworkthatweperformedfor thepurposeofmakingthis report,whichinvolvednoindependentexaminationofanyoftheunderlyingfinancial information,consistedprimarilyof comparing the unadjusted financial information with the source documents, considering the evidencesupporting the adjustments and discussing the Pro Forma Financial Information with the directors of theCompany.Weplannedandperformedourworksoastoobtaintheinformationandexplanationsweconsiderednecessaryinorder toprovideuswith reasonableassurance that theProFormaFinancial InformationhasbeenproperlycompiledonthebasisstatedandthatsuchbasisisconsistentwiththeaccountingpoliciesoftheCompany.Our work has not been carried out in accordance with auditing or other standards and practices generallyaccepted inany jurisdictionsotherthantheUnitedKingdomandaccordinglyshouldnotberelieduponas if ithadbeencarriedoutinaccordancewiththoseotherstandardsandpractices.OpinionInouropinion:• theProFormaFinancialInformationhasbeenproperlycompiledonthebasisstated;and• suchbasisisconsistentwiththeaccountingpoliciesoftheCompany.DeclarationForthepurposesofProspectusRule5.5.3R(2)(f)weareresponsibleforthisreportaspartoftheProspectusanddeclarethatwehavetakenallreasonablecaretoensurethattheinformationcontainedinthisreportis,tothebest of our knowledge, in accordancewith the facts and containsnoomission likely to affect its import. Thisdeclaration is included in the Prospectus in compliancewith item1.2 ofAnnex I and item1.2 ofAnnex III ofAppendix3.1.1oftheProspectusRules.

YoursfaithfullyScott-Moncrieff

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UNAUDITEDPROFORMAFINANCIALINFORMATIONOFTHEENLARGEDCOMPANY

PartA–Unauditedproformastatementofearnings

The following unaudited pro forma statement of earnings of the Enlarged Company has been prepared toillustratetheeffectoftheMergerandtheOfferontheearningsofApolloforthesixmonthsended31July2016asiftheMergerandtheOfferhadoccurredatthestartoftheperiod,1February2016.ThesixmonthearningsforEclipsearefortheperiodended31March2016.

Theunauditedproformastatementofearningshasbeenpreparedforillustrativepurposesonlyand,becauseofitsnature,addressesahypotheticalsituationanddoesnot,therefore,representApollo’sactualfinancialpositionorresultsnorisitindicativeoftheresultsthatmayormaynotbeexpectedtobeachievedinthefuture.

TheunauditedproformastatementofearningsisbasedontheearningsofApolloforthesixmonthsended31July2016,assetoutintheunauditedhalf-yearlyreportoftheCompanyforthesixmonthsended31July2016whichisincorporatedbyreferenceinPartFiveofthisdocumentandhasbeenpreparedinamannerconsistentwith theaccountingpolicies adoptedbyApollo inpreparing such informationandon thebasis setout in thenotessetoutbelow.

Unauditedproformastatementofearnings

OctopusApollo

OctopusEclipse Merger

VCTPlc VCTPlc Costs Proforma

(Note1) (Note2) (Note3) total

£'000 £'000 £'000 £'000

Realisedgainondisposaloffixedassetinvestments 987 143 - 1,130

Fixedassetinvestmentholdinggains 367 41 - 408

Currentassetinvestmentholdinggains - - -

Investmentincome

2,188 207 - 2,395

Investmentmanagementfees (1,405) (351) - (1,756)

Otherexpenses

(758) (273) (331) (1,362)

Returnonordinaryactivitiesbeforetax 1,379 (233) (331) 815

Taxationonreturnofordinaryactivities (70) - - (70)Returnonordinaryactivitiesaftertax

1,309 (233) (331) 745

Notes

1. TheearningsofApolloforthesixmonthsended31July2016havebeenextractedwithoutmaterialadjustment from the unaudited half-yearly report of the Company for the sixmonths ended 31 July2016whichisincorporatedbyreferenceinPartFiveofthisdocument.

Adjustments

2. TheearningsofEclipseforthesixmonthsended31March2016havebeenextractedwithoutmaterial

II:6

45

adjustment fromtheunauditedhalf-yearlyreportofEclipseforthesixmonthsended31March2016whichisincorporatedbyreferenceinPartFiveofthisdocument.ThisadjustmentisexpectedtohaveacontinuingimpactontheearningsoftheCompany.

3. Anadjustmenthasbeenmadetoreflect thetransactioncostsrelatingtotheMergerwhicharetobeexpensed.ThecommissiononthegrossproceedsoftheOfferwillbesetoffagainstthesharepremiumaccountwithinShareholder'sequity.NoaccounthasbeentakenofanypotentialirrecoverableVAT.ThisadjustmentwillnothaveacontinuingimpactontheearningsoftheCompany.

4. No account has been taken of the effects of any synergies, and of the costs formeasures taken toachieve thosesynergies, thatmayhavearisenhadtheMergeroccurredon1February2016andthatmaysubsequentlyhaveaffectedtheresultsoftheCompanyinthesixmonthsended31July2016.

5. No account has been taken of the trading performance of Apollo since 31 July 2016 or the trading

performanceofEclipsesince31March2016norofanyothereventsaveasdisclosedabove.

46

PartB–Unauditedproformastatementofnetassets

The following unaudited pro forma statement of net assets of the Enlarged Company has been prepared toillustrate theeffecton thenetassetsofApolloas if theMergerand theOfferhad takenplaceon1February2016.TheunauditednetassetsofEclipsearestatedasat31March2016.

Theunauditedproformastatementofnetassetshasbeenpreparedforillustrativepurposesonlyand,becauseof its nature, addresses a hypothetical situation and does not, therefore, represent Apollo’s actual financialpositionorresults.

TheunauditedproformastatementofnetassetsisbasedonthenetassetsofApolloasat31July2016,assetout in the unaudited half-yearly report of the Company for the six months ended 31 July 2016 which isincorporatedbyreferenceinPartFiveofthisdocumentandhasbeenpreparedinamannerconsistentwiththeaccountingpoliciesadoptedbyApolloinpreparingsuchinformationandonthebasissetoutinthenotessetoutbelow.

Unauditedproformastatementofnetassets

OctopusApolloVCTPlc

OctopusEclipseVCTPlc Fundraising Proforma

(Note1) (Note2) (Note3) total

£'000 £'000 £'000 £’000

Fixedassetinvestments 115,435 26,234 - 141,669Currentassets: Moneymarketfunds - 2,046 - 2,046Debtors 5,248 286 - 5,534Cashatbank 35,632 4,261 18,500 58,393

40,880 6,593 18,500 65,973

Creditors (4,176) (213) - (4,389)Netcurrentassets 36,704 6,380 18,500 61,584

Netassets 152,139 32,614 18,500 203,253

Notes

1. The net assets of Apollo as at 31 July 2016 have been extractedwithoutmaterial adjustment from theunauditedhalf-yearlyreportoftheCompanyforthesixmonthsended31July2016whichisincorporatedbyreferenceinPartFiveofthisdocument.

Adjustments

2. ThenetassetsofEclipseasat31March2016havebeenextractedwithoutmaterialadjustmentfromtheunauditedhalf-yearlyreportofEclipseforthesixmonthsended31March2016whichisincorporatedbyreferenceinPartFiveofthisdocument.

3. TheOffer isestimatedtoraisenetproceedsof£18.5million(£20.0milliongrossproceedslessestimated

expensesof£1.5million).Themergercostshavealsobeenaccountedfor.4.NoaccounthasbeentakenofthefinancialperformanceofApollosince31July2016orthetrading

performanceofEclipsesince31March2016norofanyothereventsaveasdisclosedabove.

47

PARTFIVE:FINANCIALINFORMATIONRELATINGTOTHECOMPANYANDECLIPSE

AuditedfinancialinformationrelatingtotheCompanyispublishedintheannualreportsfortheyearsended31January2014,31January2015and31January2016andunauditedinformationinthehalf-yearreportsforthesix month periods ended 31 July 2015 and 31 July 2016. Audited financial information relating to Eclipse ispublishedintheannualreportsfortheyearsended30September2013,30September2014and30September2015andunauditedinformationinthehalf-yearreportsforthesixmonthperiodsended31March2015and31March2016.TheannualreportsreferredtoaboverelatingtotheCompanywereauditedbyGrantThorntonUKLLPof3140RowanPlace, JohnSmithDrive,OxfordBusinessParkSouth,OxfordOX42WB.Theannual reports referred toabove relating to Eclipse were audited by BDO LLP of 55 Baker Street, London W1U 7EU. All reports werewithoutqualificationandcontainednostatementsundersection498(2)or(3)oftheCA2006.Allreportswereprepared inaccordancewithFinancialReportingStandard102withtheexceptionoftheannualreportfortheCompanyfortheyearended31January2014andtheannualreportforEclipsefortheyearended30September2013 which were prepared in accordance with the United Kingdom Accounting Standards (United KingdomGenerally Accepted Accounting Practice), the fair value rules of the CA 2006 and the Statement ofRecommended Practice ‘Financial Statements of Investment Trust Companies’. The annual reports contain adescription of the Company’s and Eclipse’s financial condition, changes in financial condition and results ofoperationforeachrelevantfinancialyearandthepagesofthesereferredtobelow,togetherwiththehalf-yearreportsreferredtoabove,arebeingincorporatedbyreferenceandcanbeaccessedatthefollowingwebsite:

www.octopusinvestments.comWherethesedocumentsmakereferencetootherdocuments,suchotherdocuments,togetherwiththosepagesof the annual andhalf-year reports that arenot referred tobelow, arenot relevant to investors and are notincorporatedintoanddonotformpartofthisdocument.Suchinformationincludesthefollowing:Apollo 31January

201431January

201531January

201631July2015 31July2016

Description AnnualReport

AnnualReport

AnnualReport

HalfYearReport

HalfYearReport

BalanceSheet

Page49

Page56 Page51

Page23

Page21

IncomeStatement(orequivalent)

Page46

Page52

Page48

Page18

Page13

Statementshowingallchangesinequity(orequivalent

Page48

Page59

Page54

Page21

Page16

48

note)CashFlowStatement

Page50

Page63

Page57

Page26

Page21

AccountingPoliciesandNotes

Page52

Page64

Page58

Page28

Page25

Auditor’sReport

Page42

Page48

Page43

N/a N/a

TheCompanyandtheDirectors confirmthattheCompany’smostrecenttwoyears’ financial informationhasbeenpresentedandprepared ina formwhich isconsistentwiththatwhichwillbeadopted intheCompany’snextpublishedannualfinancialstatements.

Suchinformationalsoincludesoperating/financialreviewsasfollows:

31January

2014

31January2015

31January2016

31July2015

31July2016

Description AnnualReport AnnualReport AnnualReport

HalfYearReport

HalfYearReport

PerformanceSummary

Page1

Page1

Page1

Page9

Page4

ResultsandDividends

Page7

Page10

Page5

Page7

Page5

InvestmentPolicy

Page5

Page8

Page13

N/a N/a

Outlook Page8

Page12

Page7

Page11

Page7

Manager’sReview

Page14

Page17

Page12

N/a N/a

PortfolioSummary

Page16

Page19

Page14

Page13

Page8

BusinessReview

Page9

Page13

Page8

N/a N/a

ValuationPolicy

Page15

Page19

Page14

N/a N/a

49

Asat 31 July 2016, thedate towhich themost recentunaudited financial informationon theCompanyhasbeendrawnup,theunauditedNAVperSharewas83.0p.A dividend of 2.5p per Sharewas subsequentlypaidon26August2016.Eclipse 30September

201330September

201430September

201531March2015

31March2016

Description AnnualReport

AnnualReport

AnnualReport

HalfYearReport

HalfYearReport

BalanceSheet

Page52 Page47 Page47 Page16

Page13

IncomeStatement(orequivalent)

Page49

Page44

Page46

Page14

Page11

Statementshowingallchangesinequity(orequivalentnote)

Page51

Page46

Page48

Page15

Page12

CashFlowStatement

Page53

Page48

Page49

Page17

Page14

AccountingPoliciesandNotes

Page55

Page50

Page50

Page19

Page15

Auditor’sReport

Page46

Page40

Page41

N/a N/a

The Company and theDirectors confirm that Eclipse’smost recent two years’ financial information has beenpresentedandprepared ina formwhich is consistentwith thatwhichwillbeadopted in theCompany’snextpublishedannualfinancialstatements.

50

Suchinformationalsoincludesoperating/financialreviewsasfollows: 30September

201330September

201430September

201531March2015

31March2016

Description AnnualReport AnnualReport AnnualReport HalfYearReport

HalfYearReport

PerformanceSummary

Page7

Page7

Page6

Page5

Page4

ResultsandDividends

Page7

Page1

Page1

Page6

Page2

InvestmentPolicy

Page5

Page5

Page3

N/a N/a

Outlook Page8

Page8

Page8

Page7

Page6

Manager’sReview

Page13

Page13

Page9

N/a N/a

PortfolioSummary

Page14

Page14

Page11

Page8

Page8

BusinessReview

Page9

Page9

Page19

N/a N/a

ValuationPolicy

Page15

Page15

Page10

N/a N/a

Asat31March2016, thedate towhich themost recentunaudited financial informationonEclipsehasbeendrawn up, the unaudited NAV per Eclipse Share was 32.5p. A dividend of 1.0p per Eclipse Share wassubsequentlypaidon24June2016.

51

PARTSIX:INVESTMENTPORTFOLIOOFTHECOMPANYANDECLIPSE

TheCompany

TheinvestmentportfoliooftheCompanyasatthedateofthisdocumentisasfollows(thevaluationsbeingtheunauditedvaluationsasat31July2016andrepresentingUKcompaniesand67.7%oftheNAVoftheCompanyasat31July2016):

Investments Sector

Investmentcostasat31

July2016(£'000)

Movementinfair

valueto31July2016

(£'000)

FairValueasat31

July2016(£'000)

Debt/Equity

CliffordThamesGroupLimited

AutomotiveSoftware&data 13,318 2,260 15,578 Debt/Equity

VistaRetailSupportLimited

Retailsupportservices 6,758 2,378 9,136 Debt/Equity

HealthcareServicesandTechnologyLimited Healthcare 7,186 759 7,945 Debt/Equity

AngloEuropeanGroupLimited Manufacturing 5,000 - 5,000 Debt/Equity

ByenaLimited InvestmentCompany 5,000 - 5,000 Debt/Equity

CoupraLimited InformationTechnology 5,000 - 5,000 Debt/Equity

EmercorLimited InvestmentCompany 5,000 -- 5,000 Debt/Equity

FinnavorLimited InvestmentCompany 5,000 5,000 Equity

GalvaraLimited InvestmentCompany 5,000 - 5,000 Debt/Equity

HaravarLimited InvestmentCompany 5,000 - 5,000 Debt/Equity

Other* Various 37,498 (2,151) 35,347 Debt/Equity

Total 99,760 3,246 103,006

*Othercomprises23investments:AcquireYourBusinessLtd,AngelicoSolarLimited,AquasoLimited,BramanteSolarLimited,BritishCountryInnsplc,CanalettoSolarLimited,CountrywideHealthcareServicesLimited,DyscovaLimited,EKFDiagnosticsplc,KabardinLimited,LeonardoSolarLimited,ModiglianoSolarLimited,PirloSolarLimited,PTBFilms,Quickfire,Quickfire2,RedPollPowerLimited,SuperiorHeatLimited,TanganyikaHeatLimited,TintorettoSolarLimited,TizianoSolarLimited,ValloirePowerLimited,andWinnipegHeat(Caspian).

Since31July2016therehavebeentwodisposals,proceedsofwhichtotalled£15.3million.Therehavebeennoacquisitions.

52

Eclipse

The investment portfolio of Eclipse as at the date of this document is as follows (the valuations being theunauditedvaluationsasat31March2016andrepresentingUKcompaniesand71%oftheNAVofEclipseasat31March2016):

Investments Sector

Investmentcostasat31March

2016(£'000)

Movementinfair

valueto31March2016

(£'000)

FairValueasat31March2016

(£'000)

Debt/Equity

OxifreeUKLimited Manufacturing 2,524 - 2,524 Debt/EquityDyscovaLimited Investmentcompany 2,200 - 2,200 Debt/EquitySpiraliteHoldingsLimited Manufacturing 2,200 - 2,200 Debt/EquityPlasticsCapitalplc Engineering 1,698 395 2,093 EquityLutherPendragonLimited

Media&MarketingServices 2,380 (630) 1,750 Debt/Equity

BarrecoreLtd ConsumerProducts 1,648 - 1,648 EquityArtesianSolutionsLimited

Technology&Communications 1,175 321 1,496 Equity

HistoryPressLimited Publishing 4,179 (2,828) 1,351 Debt/EquitySourceableLimited ConsumerProducts 644 371 1,015 EquitySecretEscapesLimited ConsumerProducts 542 448 990 EquityOther* N/A 6,458 (570) 5,888 Debt/EquityTotal 25,648 (2,493) 23,155

*Othercomprises20investments:Augeanplc,BehaviometricsAB,CelloGroupplc,CurrencyFairLimited,EcreboLimited,Ergomedplc,EveSleepLimited,HasgroveLimited,Mi-PayGroupplc,MIRACLLimited,Nektanplc,OrigamiEnergyLimited,SeguraSystemsLimited,TailscoLimited,TanfieldGroupplc,TimeoutGroupplc,TrafiLimited,VertuMotorsplc,YuGroupplc,ZynstraLimited.

Since31March2016,therehavebeenfourdisposals,theproceedsofwhichtotalled£7.1million,and9acquisitions,theinvestmentcostofwhichtotalled£3.3million.

53

EnlargedCompanyTheinvestmentportfoliooftheEnlargedCompanyasatthedatethisdocumentisasfollows,assumingtheCompanyacquiredEclipseasat31July2016(thevaluationsbeingtheunauditedvaluationsasat31July2016fortheCompanyandasat31March2016forEclipse):

Investments Sector

Investmentcostasat31July2016

(Apollo)and31March2016

(Eclipse)2016

(£'000)

Movementinfairvalueto

31July2016(Apollo)and

31March2016

(Eclipse)2016

(£'000)

FairValueasat

31July2016

(Apollo)and31March2016

(Eclipse)2016

(£'000)

Debt/Equity

CliffordThamesGroupLimited AutomotiveSoftware&data 13,318 2,260 15,578 Debt/Equity

VistaRetailSupportLimited Retailsupportservices 6,758 2,378 9,136 Debt/Equity

HealthcareServicesandTechnologyLimited Healthcare 7,186 759 7,945 Debt/Equity

AngloEuropeanGroupLimited Manufacturing 5,000 - 5,000 Debt/Equity

ByenaLimited InvestmentCompany 5,000 - 5,000 Debt/Equity

CoupraLimited InformationTechnology 5,000 - 5,000 Debt/Equity

EmercorLimited InvestmentCompany 5,000 - 5,000 Debt/Equity

FinnavorLimited InvestmentCompany 5,000 - 5,000 Equity

GalvaraLimited InvestmentCompany 5,000 - 5,000 Debt/Equity

HaravarLimited InvestmentCompany 5,000 - 5,000 Debt/Equity

Other* Various 63,146 (4,644) 58,502 Debt/EquityTotal 125,408 753 126,161

*Othercomprises52investments:AcquireYourBusinessLtd,AngelicoSolarLimited,AquasoLimited,ArtesianSolutionsLimited,Augeanplc,BarrecoreLtd,BehaviometricsAB,BramanteSolarLimited,BritishCountryInnsplc,CanalettoSolarLimited,CelloGroupplc,CountrywideHealthcareServicesLimited,CurrencyFairLimited,DyscovaLimited,EcreboLimited,EKFDiagnosticsplc,Ergomedplc,EveSleepLimited,HasgroveLimited,HistoryPressLimited,KabardinLimited,LeonardoSolarLimited,LutherPendragonLimited,Mi-PayGroupplc,MIRACLLimited,ModiglianoSolarLimited,Nektanplc,OrigamiEnergyLimited,OxifreeUKLimited,PirloSolarLimited,PlasticsCapitalplc,PTBFilms,Quickfire,Quickfire2,RedPollPowerLimited,SecretEscapesLimited,SeguraSystemsLimited,SourceableLimited,SpiraliteHoldingsLimited,SuperiorHeatLimited,TailscoLimited,TanfieldGroupplc,TanganyikaHeatLimited,TimeoutGroupplc,TintorettoSolarLimited,TizianoSolarLimited,TrafiLimited,ValloirePowerLimited,VertuMotorsplc,WinnipegHeat(Caspian),YuGroupplcandZynstraLimited.

54

PARTSEVEN:ADDITIONALINFORMATIONRELATINGTOTHECOMPANY

1 INCORPORATION

1.1 TheCompanywasincorporatedandregisteredinEnglandandWaleson7June2006undertheCA1985withregisterednumber5840377asapubliccompanylimitedbyshares.

1.2 On14July2006,theRegistrarofCompaniesissuedtheCompanywithacertificateunderSection117of

theCA1985entitlingittocommencebusiness.1.3 Octopuswas incorporatedand registered inEnglandandWaleson8March2000under theCA1985

with registerednumber3942880asaprivate company limitedby shares.Theaddressand telephonenumberofOctopus’registeredoffice isat33Holborn,LondonEC1N2HTand itstelephonenumber is08003162295.TheprincipallegislationunderwhichOctopusoperatesistheActsandregulationsmadethereunder.OctopusisauthorisedandregulatedbytheFinancialConductAuthority.

2 REGISTEREDOFFICEANDPRINCIPALLEGISLATION

2.1 TheregisteredofficeoftheCompanyisat33Holborn,LondonEC1N2HTanditstelephonenumberis

08003162295.2.2 TheCompanyisauthorisedandregulatedbytheFCAasaselfmanagedalternativeinvestmentfund.

2.3 Theprincipal legislationunderwhich theCompanyoperates andwhichgoverns its shares is theActs

andregulationsmadethereunder.3 SHAREANDLOANCAPITAL3.1OntheincorporationoftheCompany,twoordinaryshareswereissuednilpaidtothesubscriberstothe

memorandumoftheCompany,SDGRegistrarsLimitedandSDGSecretariesLimited.3.2 ByordinaryandspecialresolutionspassedbytheCompanyon30November2015,theDirectorswere

authorised inaccordancewithSection551of theCA2006 toallotSharesup toanaggregatenominalamount of £7,000,000 (representing 55.7% of the issued Shares at 30 October 2015), for a periodexpiring18monthsfromthepassingoftheresolution(unlesspreviouslyrenewed,variedorrevokedbytheCompany ingeneralmeeting)anddisapplied thepre-emptionprovisionsof Section561of theCA2006inrespectofanysuchallotment,foraperiodexpiring18monthsfromthepassingoftheresolution(unlesspreviouslyrenewed,variedorrevokedbytheCompanyingeneralmeeting).

3.3 ThefollowingResolutionswillbeproposedattheGeneralMeeting:

1. THAT,subjecttotheSchemebecomingunconditional:

1.1 theacquisitionof theassets and liabilitiesof Eclipseon the terms setout in theCircularbeandherebyisapproved;and

1.2 thedirectorsoftheCompanybeandherebyaregenerallyandunconditionallyauthorisedinaccordancewithSection551of theCompaniesAct2006 (the “Act”) toexerciseall thepowersoftheCompanytoallotSharesuptoanaggregatenominalamountof£5 millioninconnection with the Scheme (representing 28.5% of the issued share capital of theCompanyasat3November2016,thisbeingthelatestpracticabledatepriorto thedateof this notice), provided that the authority conferred by this paragraph 1.2 shall expireon the date falling 18 months from the date of the passing of this Resolution (unlessrenewed,variedorrevokedbytheCompanyingeneralmeeting).

2. THAT, inadditionto(i)existingauthoritiesand(ii)theauthoritiesconferredbyResolution1 setoutinthisnotice:

55

2.1 the directors of the Company be and hereby are generally and unconditionally authorised inaccordancewithSection551oftheActtoexerciseallthepowersoftheCompanytoallotSharesandtograntrightstosubscribeforortoconvertanysecurity intoSharesuptoanaggregatenominalamountof£4million(representing22.8 %of the issuedsharecapitalof the Company as at 3 November 2016, this being the latest practicable date prior tothe date of this notice), provided that the authority conferred by this paragraph 2.1shallexpireonthedate falling18months fromthedateof thepassingof thisResolution(unless renewed, varied or revoked by the Company in generalmeeting) but so that thisauthority shall allow the Company to make before the expiry of this authority offers oragreements which would or might require Shares to be allotted or rights to be grantedaftersuchexpiry;

2.2 thedirectorsoftheCompanybeandherebyareempoweredpursuanttoSections570and573 of the Act to allot or make offers or agreements to allot equity securities (whichexpression shall have the meaning ascribed to it in Section 560(1) of the Act) for cashpursuanttotheauthoritygivenpursuanttoparagraph2.1ofthisresolutionorbywayofasale of treasury shares, as if Section 561(1) of the Act did not apply to such allotment,providedthatthepowerprovidedbythisparagraph2.2shallexpireonthedatefalling18monthsfromthedateofthepassingofthisResolution(unlessrenewed,variedorrevokedbytheCompanyingeneralmeeting)andprovidedfurtherthatthispowershallbelimitedto:

(a) the allotment and issue of Shares up to an aggregate nominal value of £4 millionpursuanttooffer(s)forsubscription;and

(b) theallotmentandissueofSharesuptoanaggregatenominalvaluerepresenting10%oftheissuedSharecapital,fromtimetotime,

wheretheproceedsmayinwholeorpartbeusedtopurchaseShares.

3. THAT, inadditionto(i)existingauthoritiesand(ii)theauthoritiesconferredbyResolution1and2setoutinthisnotice:

3.1 the directors of the Company be and hereby are generally and unconditionally authorised inaccordancewithSection551oftheActtoexerciseallthepowersoftheCompanytoallotSharesup to an aggregate nominal amount of £1 million in connection with the Company’s dividendreinvestment scheme (representing 5.7% of the issued share capital of the Company as at 3November 2016,thisbeingthe latestpracticabledatepriortothedateofthisnotice),providedthattheauthorityconferredbythisparagraph3.1shallexpireonthedatefalling18monthsfromthedateofthepassingofthisResolution(unlessrenewed,variedorrevokedbytheCompanyingeneralmeeting)butsothatthisauthorityshallallowtheCompanytomakebeforetheexpiryofthisauthorityoffersoragreementswhichwouldormightrequireSharestobeallottedaftersuchexpiry;

3.2 thedirectorsoftheCompanybeandherebyareempoweredpursuanttoSections570and573ofthe Act to allot ormake offers or agreements to allot equity securities (which expression shallhavethemeaningascribedto it inSection560(1)of theAct) forcashpursuant to theauthoritygivenpursuant to paragraph3.1 of this Resolutionor bywayof a sale of treasury shares, as ifSection561(1)of theActdidnotapply tosuchallotment,providedthat thepowerprovidedbythisparagraph3.2shallexpireonthedatefalling18monthsfromthedateofthepassingofthisResolution(unlessrenewed,variedorrevokedbytheCompanyingeneralmeeting)andprovidedfurtherthatthispowershallbe limitedtotheallotmentand issueofSharesuptoanaggregatenominalvalueof£1millioninconnectionwiththeCompany’sdividendreinvestmentscheme.

4. THAT , the articles of association produced to the meeting, and for the purpose ofidentification initialed by the Chairman, be adopted as the articles of association of theCompany.

56

5. THAT theCompanybeandhereby isempowered tomakeoneormoremarketpurchaseswithin themeaningofSection693(4)of theActof itsownShares (either forcancellationorfortheretentionastreasurysharesforfuturere-issueortransfer)providedthat:

(a) the aggregate number of Shares which may be purchased shall not exceed26,259,520 Shares;

(b) theminimumpricewhichmaybepaidperShareisthenominalvaluethereof;

(c) themaximumpricewhichmay be paid per Share is an amount equal to the higher of (i)105%of theaverageof themiddlemarketquotationperShareof therelevantclass takenfrom the London Stock Exchange daily official list for the five business days immediatelyprecedingthedayonwhichsuchShareistobepurchasedand(ii)theamountstipulatedbyArticle5(6)oftheMarketAbuseRegulation;

(d) theauthorityconferredbythisResolutionshallexpireonthedate falling18monthsfromthedateofthepassingofthisResolution(unlessrenewed,variedorrevokedbytheCompanyingeneralmeeting);and

(e) theCompanymaymakeacontracttopurchaseSharesundertheauthorityconferredbythisResolutionpriortotheexpiryofsuchauthoritywhichwillormaybeexecutedwhollyorpartlyaftertheexpirationofsuchauthority.

6. THAT,subjecttotheapprovaloftheHighCourtofJustice,theamountstandingtothecreditofthe

Company’s share premium account at the date that the court order granting the cancellation ismade,becancelled.

7. THAT,subjecttotheapprovaloftheHighCourtofJustice,theamountstandingtothecreditofthe

Company’scapitalredemptionreserveatthedatethatthecourtordergrantingthecancellationismade,becancelled.

For the purposes of these Resolutions, words and expressions defined in the Circular shall have thesamemeaningsinthisnotice,savewherethecontextrequiresotherwise.

3.4 AtthedateofthisdocumenttheissuedfullypaidsharecapitaloftheCompanyis:

Classofshares

Nominalvalue

Issued(fullypaid)

£ no

OrdinaryShares

£0.10 17,518,027 175,180,266

Inaddition, thereare15,620,519economicallyworthlessdeferredsharesresultingfromtheformerDordinaryshares,thatwillbeboughtbackinduecoursebytheCompanyforanominalvalue.

3.5 TheissuedfullypaidsharecapitaloftheCompanyimmediatelyaftertheOfferhasclosed(assuming(i)

theOffer is fully subscribed, (ii) that theOfferPrice is either85.2por52.1pand (iii) that38,899,060SchemeSharesareissuedpursuanttotheMerger)willbeasfollows:

57

Classofshares Nominalvalue

Issued(fullypaid)(0fferPrice=85.2p)

Issued(fullypaid)(OfferPrice=52.1p)

£ Number £NumberOrdinaryShares £0.10 23,755,350 237,553,504 25,246,704 252,467,041

3.6ThefollowingallotmentsandrepurchasesofShareshavetakenplacesince1February2013:

Allotmentdate Sharesissued Issueprice(p)

15February2013 18,043,313 94.50

20March2013 4,855,005 94.50

3April2013 7,758,249 94.50

5April2013 5,012,898 94.50

30April2013 961,319 94.00

3June2013 1,490,277 91.40

28June2013 3,100,553 91.80

21February2014 4,552,069 89.70

27August2014 15,563 86.90

19December2014 4,345,635 88.90

22December2014 881,211 88.90

13March2015 5,222,578 88.90

31March2015 6,541,808 88.90

4April2015 3,534,572 88.90

28April2015 1,382,366 88.90

2July2015 2,413,053 89.30

31July2015 166,021 82.30

21August2015** 19,809,055 83.40

28August2015 4,190,865 86.70

1October2015 3,383,579 86.70

11December2015 2,328,139 85.20

18December2015* 303,243 80.90

08January2016 7,638,436 85.20

23February2016 5,415,410 85.80

23February2016* 512 82.30

23March2016 7,614,240 85.80

23March2016* 1,428 82.30

23March2016* 44 80.90

30March2016 3,543,202 85.80

05April2016 8,363,388 85.80

13April2016 1,285,617 85.80

13May2016 1,369,255 85.80

13May2016 15,667 85.80

III:4.1

III:4.3

58

13May2016 922 85.80

13May2016 11,324 85.80

23June2016 2,011,192 86.70

04August2016*** 3,850,093 83.00

10August2016 4,387,618 87.40

26August2016* 685,018 80.50

16September2016 3,777,225 84.80*SharesallottedtothoseshareholdersparticipatingintheDRIS**SharesallottedtoformerCOrdinaryshareholderswhoconvertedtheirCshareholdingintoOrdinarysharesataratioof1.17506OrdinarysharesperCOrdinaryshare.***SharesallottedtoformerDOrdinaryshareholderswhoconvertedtheirDshareholdingintoOrdinarysharesataratioof1.11205OrdinarysharesperDOrdinaryshare.The Company allotted 15,620,519 deferred shares on 5 August 2016 at nil consideration inrespectoftheDordinaryshareholderswhoelectedtoreceivetheDsharedividend.

Buybackdate Sharesbought Price(p)

15February2013 18,868,091 89.70

29April2013 150,000 84.75

3May2013 788,540 84.75

28May2013 184,200 82.25

31July2013 414,397 82.75

30September2013 270,849 82.75

18November2013 169,387 80.50

22January2014 257,907 80.75

29May2014 613,406 82.50

30May2014 225,000 82.50

25June2014 110,000 80.00

31July2014 340,721 80.00

1October2014 160,000 82.50

7October2014 166,745 82.50

22December2014 150,000 80.00

28January2015 464,523 80.00

30January2015** 230,021 88.00

11June2015 340,000 80.50

26June2015 69,236 80.50

31July2015 219,363 78.00

6October2015 945,151 79.25

9October2015 629,662 79.25

05November2015 387,979 79.25

10November2015 434,567 79.25

29January2016 834,486 78.00

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29January2016 696,491 78.00

02June2016 350,000 78.70

07June2016 280,000 78.70

08June2016 235,000 78.70

22July2016 280,585 78.70

07September2016 240,079 77.00

19October2016 375,000 77.00

**BuybackofCordinaryshares 3.7 OtherthantheissueofOfferShares,SchemeSharesand,subjecttotheapprovalofResolution3 atthe

General Meeting, Shares under its Dividend Reinvestment Scheme, the Company has no presentintentiontoissueanyShares.

3.8 TheCompanydoesnothaveinissueanysecuritiesnotrepresentingsharecapital.3.9 TheprovisionsofSection561(1)ofCA2006(totheextentnotdisappliedsubjecttoSections570or571

of the CA 2006) confer on shareholders certain rights of pre-emption in respect of the allotment ofequitysecurities(asdefinedinSection560(1)oftheCA2006)whichare,oraretobe,paidupincashandwill apply to theCompany, except to the extent disappliedby theCompany in generalmeeting.Subject tocertain limitedexceptions,unless theapprovalof theShareholders inageneralmeeting isobtained,theCompanymustnormallyoffersharestobeissuedforcashtoholdersonaproratabasis.

3.10 NosharesoftheCompanyarecurrently in issuewithafixeddateonwhichentitlementtoadividend

arises and there areno arrangements in forcewhereby futuredividends arewaivedor agreed tobewaived.

3.11 No share or loan capital of the Company is under option or has been agreed, conditionally or

unconditionally,tobeputunderoption.3.12 Exceptforcommissionspaidtoauthorisedintroducersinrespectofpreviousoffersforsubscriptionof

Shares, no commissions, discounts, brokerages or other special terms have been granted by theCompany in connection with the issue or sale of any share or loan capital of the Company since 1February2013.

3.13 Other than pursuant to the Offer and the Scheme, none of the New Shares have been sold or are

availableinwholeorinparttothepublicinconjunctionwiththeapplicationfortheNewSharestobeadmittedtotheOfficialList.

3.14 TheNewShareswillbeinregisteredform.Notemporarydocumentsoftitlewillbeissuedandpriorto

the issue of definitive certificates, transfers will be certified against the register. It is expected thatdefinitivesharecertificatesfortheNewSharesnottobeheldthroughCRESTwillbepostedtoallotteesassoonaspracticablefollowingallotmentoftherelevantshares.NewSharestobeheldthroughCRESTwillbecreditedtoCRESTaccountsonAdmission.CRESTisapaperlesssettlementprocedureenablingsecuritiestobeevidencedotherwisethanbyacertificateandotherwisethanbyawritteninstrument.TheArticlesoftheCompanypermittheholdingofsharesinCREST.

3.15 TheISINandSEDOLCodesoftheSharesareGB00B17B3479andB17B347respectively.

III:4.1:

I:17.2

III:4.1

I:17.2

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4 DIRECTORS’INTERESTS4.1 AsatthedateofthisdocumenttheDirectorsandtheirimmediatefamilieshavethefollowinginterestsin

theissuedsharecapitaloftheCompany:

Director NumberofShares %ofIssuedShareCapital MurraySteele 30,102 lessthan0.1%JamesOtter 17,630 lessthan0.1%ChristopherPowles 5,868 lessthan0.1%IanPearson 12,046 lessthan0.1%

4.2 Assumingthat(i)theOfferisfullysubscribedatanOfferPriceof85.2pand(ii)that38,899,060Scheme

SharesareissuedpursuanttotheMerger,theinterestsoftheDirectorsandtheirimmediatefamiliesintheissuedsharecapitaloftheCompanyimmediatelyfollowingtheOfferandtheMergerwillbe:

Director NumberofShares %ofIssuedShareCapital MurraySteele 35,970 lessthan0.1%JamesOtter 17,630 lessthan0.1%ChristopherPowles 11,736 lessthan0.1%IanPearson 12,046 lessthan0.1%AlexHambro 12,048 lessthan0.1%

4.3 At thedateof thisdocument, theCompany isnotawareofanypersonwhohasorwillhold (after the

Schemehascompletedand/ortheOfferhasclosed)directlyorindirectly,votingrightsrepresenting3%ormoreoftheissuedsharecapitaloftheCompanytowhichvotingrightsareattached(assumingthat(i)theOfferisfullysubscribedatanOfferPriceof85.2pand(ii)38,899,060SchemeSharesareissuedpursuanttotheMerger)orwhocould,directlyorindirectly,jointlyorseverally,exercisecontrolovertheCompany.

4.4 Thepersons,includingtheDirectors,referredtoinparagraphs4.1to4.2above,donothavevotingrights

in respect of the share capital of the Company (issued or to be issued) which differ from any otherShareholder.

4.5 TheCompany and theDirectors arenot awareof any arrangements, theoperationofwhichmay at a

subsequentdateresultinachangeofcontroloftheCompany.4.6 NoDirectorhasanyinterestinanytransactionswhichareorwereunusualintheirnatureorconditions

or which are or were significant to the business of the Company and which were effected by theCompanyinthecurrentorimmediatelyprecedingfinancialyearorwhichwereeffectedduringanearlierfinancialyearandwhichremaininanyrespectoutstandingorunperformed.

4.7 InadditiontotheirdirectorshipsoftheCompany,theDirectorscurrentlyhold,andhaveduringthefive

years preceding the date of this document held, the following directorships, partnerships or been amemberoftheseniormanagement:

Name Position Nameofcompany/partnership Positionstillheld(Y/N)

MurraySteele Director SurfaceGenerationLimited Y

Director WMBSteele(2009)&Co.Limited Y

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Director JWPSTrusteesLimited Y

Director JWSEMPPTrusteesLimited Y

Director JamesWalkerTrusteesLimited Y

Director

Director

Director

JamesWalkerGroupLimited

LondonInternetExchangeLimited

HealthyBoardServicesLtd

Y

Y

Y

Director CBGHoldingsLimited(inliquidation) Y

Director RingmountLimited(Dissolved) N

Director

OctopusApolloVCT4plc(Dissolved)*

N

JamesOtter Director OctopusVCTplc(Dissolved)* N

Director TCSCellworksLimited Y

Director JottLimited Y

Director EllipsonLimited Y

Director

Director

Director

Director

VendaGroupLimited(inliquidation)

HygeaVCTplc

AxonLimited

GlidePharmaceuticalTechnologiesLimited

Y

N

N

N

ChristopherPowles

Director LittleSuttonEnergyCompanyLimited N

Director SusencoManagementLimited Y

Director FlightsMillCommunityHydroPowerLimited

Y

Director

Director

BicesterEnergyCompanyLimited

OctopusApolloVCT4plc(Dissolved)*

Y

N

IanPearson

Director

ThamesWaterUtilitiesLimited

Y

Director CodeInvestingLimited Y

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Director IPPAssociatesLimited Y

Director OctopusVCT2plc(inliquidation) Y

*Inmembersvoluntaryliquidationpriortobeingdissolved

ThebusinessaddressofalltheDirectorsis33Holborn,LondonEC1N2HT.

4.8 Saveassetoutabove,noneoftheDirectorshasatanytimewithinthelastfiveyears:4.8.1 hadanyconvictions(whetherspentorunspent)inrelationtooffencesinvolvingfraudordishonesty;

4.8.2 been the subject of any official public incrimination and/or sanctions by statutory or regulatory

authorities (includingdesignatedrecognisedprofessionalbodies)orbeendisqualifiedbyacourt fromactingasadirectorofacompanyor fromacting in themanagementorconductof theaffairsofanycompany;

4.8.3 been a director or seniormanager of a company which has been put into receivership, compulsory

liquidation,administration,companyvoluntaryarrangementoranycompositionorarrangementwithitscreditorsgenerallyoranyclassofitscreditors,saveassetoutinparagraph4.7above;or

4.8.4 been the subject of any bankruptcy or been subject to an individual voluntary arrangement or a

bankruptcyrestrictionsorder.4.9 Therearenoarrangementsorunderstandingswithmajorshareholders,customers, suppliersorothers,

subject to which any Director was selected as a member of the administrative, management orsupervisorybodiesormemberofseniormanagement.

4.10 There are no outstanding loans or guarantees provided by the Company for the benefit of any of the

DirectorsnorarethereanyloansoranyguaranteesprovidedbyanyoftheDirectorsfortheCompany.4.11 TheDirectorsandOctopusdonothaveanyconflictsofinterestbetweentheirdutiestotheCompanyand

theirprivateinterestsorotherduties.5 DIRECTORS’LETTERSOFAPPOINTMENT

MurraySteeleandChristopherPowleswereappointedasDirectorson28September2012,JamesOtterwasappointedasaDirectoron28November2014and IanPearsonwasappointedasaDirectoron27January2016.TheDirectors’appointmentsareterminableonthreemonths’noticeandnoarrangementshave been entered into by the Company entitling theDirectors to compensation for loss of office norhave amounts been set aside to provide pension, retirement or similar benefits. Murray Steele, asChairmanoftheCompany,isentitledtoannualremunerationof£30,000,andChrisPowles,asChairmanoftheAuditCommittee,isentitledtoannualremunderationof£25,000,whiletheannualremunerationreceivable by the other Directors is £22,500. None of the Directors has a service contract with theCompanyandnosuchcontractisproposed.Inrespectoftheyearended31January2016,MurraySteelereceived £25,000, Christopher Powles received £20,000, James Otter received £20,000, Ian Pearsonreceived£231andMattCooper,whoresignedasadirectoron27January2016,received£20,000.

In the event that the Merger proceeds, Alex Hambro will join the Board and will receive an annual

remunerationof£22,500.IanPearsonwillstanddownfromtheBoardon31January2017.

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6 THECOMPANYANDITSSUBSIDIARIES

TheCompanydoesnothaveanysubsidiaries.7 OFFERAGREEMENT

An agreement dated 4 November 2016, between the Company (1), the Directors (2), Octopus (3) andHoward Kennedy (4) pursuant towhichHoward Kennedy agreed to act as sponsor to the Company inrespect of the Offer and the Scheme and Octopus agreed to use reasonable endeavours to procuresubscribersforOfferSharesundertheOffer.UndertheagreementOctopusispaid,aninitialfeeofupto5.5%of the funds receivedunder theOffer and anongoing feeof 0.5%per annumof theNAVof theinvestment amounts received from investors under the Offer who have invested directly into theCompanyandnotthroughafinancial intermediary,foruptonineyearsandhasagreedtodischargeallexternal costs of advice and their own costs in respect of the Offer. Under this agreement certainwarranties have been given by the Company, the Directors and Octopus to the other parties. TheCompanyhasalsoagreedtoindemnifyHowardKennedyinrespectofitsroleassponsor.Thewarrantiesand indemnity are in usual form for a contract of this type. The agreement can be terminated if anystatementintheProspectusisuntrue,anymaterialomissionfromtheProspectusarisesoranybreachofwarrantyoccurs.

8 MATERIALCONTRACTS Thefollowingaretheonlycontracts(notbeingcontractsenteredintointheordinarycourseofbusiness)

whichhavebeenenteredintobytheCompanyinthetwoyears immediatelyprecedingthedateofthisdocument or which are expected to be entered into prior to Admission and which are, or may be,materialorwhichhavebeenenteredintoatanytimebytheCompanyandwhichcontainanyprovisionunder which the Company has any obligation or entitlement which is, or may be, material to theCompanyasatthedateofthisdocument:

8.1 TheOfferAgreement,detailsofwhicharesetoutinparagraph7above.8.2 Anofferagreementdated2November2015,between theCompany (1), theDirectors (2),Octopus (3)

andHowardKennedy(4)pursuanttowhichHowardKennedyagreedtoactassponsortotheCompanyinrespectoftheofferforsubscriptionthatwaslaunchedon2November2015(the"2015Offer")andthemergerbetweentheCompanyandOVCT2andOctopusagreedtousereasonableendeavourstoprocuresubscribersforSharesunderthe2015Offer.UndertheagreementOctopuswaspaidaninitialfeeofupto5.0%ofthefundsreceivedunderthe2015Offerandanongoingfeeof0.5%perannumoftheNAVoftheinvestment amounts received from investors under the 2015 Offer who invested directly into theCompany and not through a financial intermediary, for up to nine years and agreed to discharge allexternalcostsofadviceandtheirowncosts inrespectofthe2015Offer.Underthisagreementcertainwarrantiesweregivenby theCompany, theDirectorsandOctopus to theotherparties. TheCompanyalsoagreedtoindemnifyHowardKennedyinrespectofitsroleassponsor.Thewarrantiesandindemnityareinusualformforacontractofthistype.

8.3 Anofferagreementdated24October2014,betweentheCompany(1),theDirectors(2),Octopus(3)and

Howard Kennedy (4) pursuant towhichHoward Kennedy agreed to act as sponsor to the Company inrespectof theoffer forsubscription thatwas launchedon24October2014 (the“2014Offer”)and themergerbetweentheCompanyandOVCTandOctopusagreedtousereasonableendeavourstoprocuresubscribersforSharesunderthe2014Offer.UndertheagreementOctopuswaspaidaninitialfeeofupto5.0%ofthefundsreceivedunderthe2014Offerandanongoingfeeof0.5%perannumoftheNAVofthe

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investment amounts received from investors under the 2014 Offer who invested directly into theCompany and not through a financial intermediary for up to nine years and agreed to discharge allexternalcostsofadviceandtheirowncosts inrespectofthe2014Offer.Underthisagreementcertainwarrantiesweregivenby theCompany, theDirectorsandOctopus to theotherparties. TheCompanyalso agreed to indemnify Howard Kennedy in respect of its role as sponsor to the 2014 Offer. Thewarrantiesandindemnityareinusualformforacontractofthistype.

8.4 ThelettersofappointmentoftheDirectors,detailsofwhicharesetoutinparagraph5above.8.5 An investment management agreement dated 27 July 2006,asvariedbydeedsofvariationdated16

August2012,28April2014,24October2014and2November2015(the“IMA”)between the Company(1) and Octopus (2) pursuant to which Octopus provides discretionary investment managementand administrationservicestotheCompany.TheappointmentofOctopus is terminablebyeitherpartyon not less than 12months’ notice in writingandmayalsobeterminatedincircumstancesofmaterialbreachbyeitheroftheseparties.Octopus receives an annualmanagement fee of an amount equal to2%ofthenetassetsofthe Company, calculatedonadailybasisfrom31Januaryand payable quarterlyin arrears, together with any applicable VAT thereon in respect of investment management services.Octopusalsoreceivesanannualadministrationandaccountingfeeofanamountequalto0.3%ofthe netassets of the Company, calculated at annual intervals as at 31 January and payablequarterly (plusVAT) and an annual company secretarial fee of £20,000 per annumpayableannuallyorquarterly.

Pursuant to the IMA, Octopus is entitled to an annual performance related incentive fee in eachaccounting period, subjecttothetotalreturnbeing100pattheendoftherelevantperiod.Theamountofthefeewillbeequalto20%oftheamountbywhichthetotalreturnasattheendoftherelevantperiodexceedsthetotalreturnasat31January2012pluscumulativeBankofEnglandbaserateor,ifgreater,thehighest total return as at the end of the accounting period commencing on 1 February 2012or anysubsequentaccountingperiod.ThenormalannualexpensesoftheCompanyundertheIMAarecappedeachyearatanamount agreedbetween the Company and Octopus. For the current year the normal annualexpensesarecappedatan amount equal to 3.3% of the Company’s net assets, this being the amount set on launch of theCompany.Any excessover this amountwill bebornebyOctopus.Normal annual expenses means theannual expenses of the Company incurred in its ordinarycourse of business and includes the annualinvestment management, administration, and secretarial fees, directors’ remuneration, normal feespayabletotheCompany’sregistrars, stockbroker,auditors,solicitorsandVCTstatusadvisers.Itdoes notincludeanyexceptionalitems,annualtrailcommissionorirrecoverableVATthereon.

Octopus has the right to charge transaction, directors’, monitoring, consultancy, corporate finance,introductory, syndication fees,commissionsand refundsofcommissions in respectof themanagementof the Company’s investment portfolio. Such fees do not typically exceed 1.5% of the total amountinvestedbyallOctopusmanagedfunds(includingtheCompany)perannum,assuminganinvestmentof£5millionandaholdingperiodoffiveyears.ThecostsofalldealsthatdonotproceedtocompletionwillbebornebyOctopus.Theagreement includes indemnities givenby theCompany toOctopuswhichareusualforthistypeofagreement.

The following contracts will be entered into subject, inter alia, to the approval by Shareholders of

Resolution1tobeproposedattheGeneralMeeting:8.6 AtransferagreementbetweentheCompanyandEclipse(actingthroughtheLiquidators)togiveeffectto

the Scheme pursuant to which all of the assets and liabilities of Eclipse will be transferred to the

I:19

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Company(subjectonlytotheconsentsfromthirdpartieswhichmayberequiredtotransfersuchassetsand liabilities) inconsiderationforSchemeShares,asdescribed inPartOneofthisdocument. Ifanyofthepartiesso require,Eclipse,actingby theLiquidators, shallpromptlygive instructions toanypersonholdinganypartofEclipse'sassetsasnomineeoforontrustforEclipse,requiringsuchpersontotransfersuchassetstotheCompany.Eclipse,actingbytheLiquidators,willalsoundertaketoexecuteanddeliversuchotherdocumentsandtakesuchotherstepsasshallbereasonablyrequiredbytheCompanytovestintheCompanytheassetstobetransferredtotheCompanyunderthisagreementandotherwisetogivetheCompanythefullbenefitofthisAgreement.TheLiquidatorswillagreeunderthisagreementthatallsaleproceedsand/ordividendsreceivedinrespectoftheunderlyingassetsofEclipsewillbetransferredonreceipttotheCompanyaspartoftheScheme.

8.7 AdeedofindemnityfromtheCompanytotheLiquidatorspursuanttowhichtheCompanywillindemnify

theLiquidatorsforexpensesandcostsincurredbytheminconnectionwiththeScheme.

9 RELATEDPARTYTRANSACTIONS Save for the fees paid to the Directors as detailed in paragraph 5 above, the fees paid under the

investmentmanagementagreementdetailedinparagraph8.5above,thepromoter’sfeeof£0.14million paidtoOctopusinrespectoftheCompany'stop-upofferlaunchedon2December2013,thepromoter’sfeeof£0.3millionpaidtoOctopusinrespectoftheCompany’sofferforsubscriptionthatwaslaunchedon24October2014,thepromoter’sfeeof£0.7millionpaidtoOctopusinrespectoftheCompany’sofferforsubscriptionthatwaslaunchedon2November2015andthepromoter’sfeepayableinrespectoftheOfferAgreement,therewerenootherrelatedpartytransactionsorfeespaidbytheCompanyduringtheyearsended31 January2014,31 January2015and31 January2016or for theperiod from31 January2016tothedateofthisdocument.

10. WORKINGCAPITALThe Company is of the opinion that theworking capital available to the Company is sufficient for theCompany’spresentrequirements,thatis,foratleasttheperiodoftwelvemonthsfromthedateofthisdocument.

11. CAPITALISATIONANDINDEBTEDNESS11.1 ThecapitalisationoftheCompanyasat31July2016wasasfollows:

Capitalandreserves £’000CalledupEquityShareCapital 16,745SharePremium 1,438SpecialDistributableReserve 128,328CapitalRedemptionReserve 2,672CapitalReserveRealised (1,087)CapitalReserveUnrealised: 2,988RevenueReserve: 1,055

TotalEquityShareholders’Funds 152,139

Since 31 July 2016, a dividend totalling £14.4millionwas paid to investors and additional allotmentshave occurred as detailed in 3.6 above. Save in respect of thesematters there has been nomaterialchangetothecapitalisationsince31July2016.

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11.2 Asat31August2016theCompanyhadnoindebtedness.TheCompanyhaspowertoborrowundertheArticles,detailsofwhicharesetoutintheparagraphentitled“Borrowingpowers”inparagraph14.1.12below.

12. AUDIT,REMUNERATIONANDNOMINATIONCOMMITTEES

AuditCommittee

12.1 TheauditcommitteeoftheCompanycomprisestheBoard,ischairedbyChristopherPowlesandmeetstwiceayearandonanadhocbasisasnecessary.ThecommitteehasdirectaccesstoGrantThorntonUKLLP,3140RowanPlace,JohnSmithDrive,OxfordBusinessParkSouth,OxfordOX42WB,theCompany’sexternalauditor.Thedutiesoftheauditcommitteeare,interalia:

12.1.1 to reviewand approve thehalf yearly and annual results of theCompany and the statutoryaccountsbeforesubmissiontotheBoard;

12.1.2 toreviewandapprovetheexternalauditor’stermsofengagementandremuneration;and

12.1.3 to review the appropriateness of the Company’s accounting policies, to considermatters ofcorporate governance as may generally be applicable to the Company and to makerecommendationstotheBoardinconnectiontherewithasappropriate.

NominationandRemunerationCommittees12.1.4 A nomination committee consisting of James Otter and Christopher Powles has been

established to consider recommendations for the re-election of Directors. To date noremuneration committee has been established andmatters relating to remuneration of theDirectorsareconsideredbytheBoardandanyDirectorisexcludedfrommeetingsthepurposeofwhichisthesettingofhisownremuneration.

13. LITIGATION

Therearenogovernmental, legalorarbitrationproceedings(includinganysuchproceedingswhicharependingorthreatenedofwhichtheCompanyisaware)duringthe12monthperiodendingonthedateofthisdocumentwhichmayhave,orhavehadintherecentpast,significanteffectsontheCompany’sfinancialpositionorprofitability.

14. ARTICLESOFTHECOMPANY

14.1 ThearticlesofassociationoftheCompany(the“Articles”),contain,interalia,thefollowingprovisions.

14.1.1 VotingRights

Subjecttoanydisenfranchisementasprovidedinparagraph14.1.4belowtheSharesshallcarrytherighttoreceivenoticeofortoattendorvoteatanygeneralmeetingoftheCompanyandonashowofhandseveryholderof Sharespresent inperson (orbeing a corporation, presentby authorisedrepresentative)shallhaveonevoteand,onapoll,everyholderofShareswhoispresentinpersonorbyproxyshallhaveonevote foreveryShareofwhichhe is theholder.TheSharesshall rankparipassuastorightstoattendandvoteatanygeneralmeetingoftheCompany.

I:20.8

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14.1.2 TransferofSharesThe Shares are in registered form andwill be freely transferable free of all liens. All transfers ofSharesmustbeeffectedbyatransferinwritinginanyusualformoranyotherformapprovedbytheDirectors.TheinstrumentoftransferofaShareshallbeexecutedbyoronbehalfofthetransferorand,inthecaseofapartlypaidShare,byoronbehalfofthetransferee.TheDirectorsmayrefusetoregister any transfer of a partly paid Share, provided that such refusal does not prevent dealingstakingplaceonanopenandproperbasisandmayalsorefusetoregisteranyinstrumentoftransferunless:

14.1.3

(i)itisdulystamped(ifsorequired),islodgedwiththeCompany’sregistrarsoratsuchotherplaceastheDirectorsmayappointandisaccompaniedbythecertificateforthesharestowhichitrelatesandsuchotherevidenceastheDirectorsmayreasonablyrequiretoshowtherightofthetransferortomakethetransfer;

(ii) itisinrespectofonlyoneclassofshare;and(iii)thetransfereesdonotexceedfourinnumber.DividendsThe Company may in general meeting by ordinary resolution declare dividends to be paid tomembersinaccordancewiththeArticles,providedthatnodividendshallbepayableinexcessoftheamountrecommendedbytheDirectors.TheDirectorsmaypaysuchhalf-yeardividendsasappeartothemtobejustified.Nodividendorothermoniespayableinrespectofashareshallbearinterestas against the Company. There are no fixed dates onwhich entitlement to a dividend arises. AlldividendsunclaimedforaperiodoftwelveyearsafterbeingdeclaredorbecomingdueforpaymentshallbeforfeitedandshallreverttotheCompany.TheSharesshallentitletheirholderstoreceivesuchdividendsastheDirectorsmayresolvetopayout of the net assets attributable to the Shares and from income received and accruedwhich isattributabletotheShares.The Directors may, with the prior sanction of an ordinary resolution of the Company, offerShareholders the right to elect to receive in respect of all or part of their holding of Shares,additionalSharescreditedasfullypaid insteadofcash inrespectofallorpartofsuchdividendordividendsand(subjectashereinafterprovided)uponsuchtermsandconditionsandinsuchmannerasmaybespecifiedinsuchordinaryresolution.TheordinaryresolutionshallconferthesaidpowerontheDirectorsinrespectofallorpartofaparticulardividendorinrespectofalloranydividends(oranypartofsuchdividends)declaredorpaidwithinaspecifiedperiodbutsuchperiodmaynotend later than the date of the annual general meeting next following the date of the generalmeetingatwhichsuchordinaryresolutionispassed.

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14.1.4 DisclosureofInterestinSharesIf any Shareholder or other person appearing tobe interested in Shares is in default in supplyingwithin14daysafterthedateofserviceofanoticerequiringsuchmemberorotherpersontosupplytotheCompanyinwritingalloranysuchinformationasisreferredtoinSection793oftheCA2006,the Directors may, for such period as the default shall continue, impose restrictions upon therelevantShares.Therestrictionsavailablearethesuspensionofvotingorotherrightsconferredbymembership inrelationtomeetingsoftheCompanyinrespectoftherelevantSharesandadditionallyinthecaseofaShareholderrepresentingat least0.25%bynominalvalueofanyclassofSharesoftheCompanytheninissue,thewithholdingofpaymentofanydividendson,andtherestrictionoftransferof,therelevantShares.

14.1.5 DistributionofAssetsonLiquidationOnawinding-upanysurplusassetswillbedividedamongsttheholdersofeachclassofsharesintheCompanyaccordingtotherespectivenumbersofsharesheldbythemand inaccordancewiththeprovisionsoftheCA2006,subjecttotherightsofanyshareswhichmaybeissuedwithspecialrightsorprivileges.TheArticlesprovidethattheliquidatormay,withthesanctionofaspecialresolutionandanyothersanctionrequiredbytheCA2006,divideamongstthemembersinspeciethewholeoranypartoftheassetsoftheCompanyinsuchmannerashemaydetermine.

14.1.6 ChangesinShareCapital

(i) Without prejudice to any rights attaching to any existing shares, any share may beissued with such rights or restrictions as the Company may by ordinary resolutiondetermine or in the absence of such determination, as the Directorsmay determine.SubjecttotheCA2006,theCompanymay issueshares,whichare,orattheoptionoftheCompanyortheholderare,liabletoberedeemed.

(ii) The Company may by ordinary resolution increase its share capital, consolidate anddividealloranyofitssharecapitalintosharesoflargeramount,sub-divideitssharesoranyof them intosharesofsmalleramounts,orcancelor reducethenominalvalueofanyshareswhichhavenotbeentakenoragreedtobetakenbyanypersonanddiminishthe amount of its share capital by the amount so cancelled or the amount of thereduction.

(iii)(iv)

SubjecttotheCA2006,theCompanymaybyspecialresolutionreduceitssharecapital,anycapitalredemptionreserveandanysharepremiumaccount,andmayalso,subjecttotheAct,purchaseitsownshares.TheCompanymaybyordinaryresolutionconvertanyfullypaidupsharesintostockofthesameclassastheshareswhichshallbesoconverted,andreconvertsuchstockintofullypaidupsharesofthesameclassandofanydenomination.

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14.1.7

VariationofRightsWheneverthecapitaloftheCompanyisdividedintodifferentclassesofshares,therightsattachedto any class may (unless otherwise provided by the terms of issue of that class) be varied orabrogated eitherwith the consent inwriting of the holders of not less than three-fourths of thenominalamountof the issuedsharesof theclassorwith the sanctionofa resolutionpassedataseparatemeetingofsuchholders.

14.1.8 DirectorsUnless anduntil otherwisedeterminedby anordinary resolutionof theCompany, thenumberofDirectors shall not be fewer than two nor more than ten. The continuing Directors may actnotwithstandinganyvacancy in theirbody,provided that if thenumberof theDirectorsbe fewerthan the prescribed minimum the remaining Director or Directors shall forthwith appoint anadditional Director or additional Directors tomake up suchminimum or shall convene a generalmeetingoftheCompanyforthepurposeofmakingsuchappointment.AnyDirectormayinwritingunderhishandappoint(a)anyotherDirector,or(b)anyotherpersonwho is approvedby theBoardashereinafterprovided, tobehisalternate.ADirectormayatanytimerevoketheappointmentofanalternateappointedbyhim.EverypersonactingasanalternateDirectoroftheCompanyshallbeanofficeroftheCompany,andshallaloneberesponsibletotheCompanyforhisownactsanddefaults,andheshallnotbedeemedtobetheagentofor for theDirectorappointinghim.Subject to theprovisionsof theStatutes (asdefined in theCompany’sarticlesofassociation), theDirectorsmayfromtimetotimeappointoneormoreoftheirbodytobemanagingdirectororjointmanaging directors of the Company or to hold such other executive office in relation to themanagementofthebusinessoftheCompanyastheymaydecide.

A Directormay continue to be or become a director or other officer, servant ormember of anycompanypromotedbytheCompanyorinwhichtheymaybeinterestedasavendor,shareholder,orotherwise,andnosuchDirectorshallbeaccountableforanyremunerationorotherbenefitsderivedasDirectororotherofficer,servantormemberofsuchcompany.The Directors may from time to time appoint a chairman of the Company (who need not be aDirectoroftheCompany)andmaydeterminehisdutiesandremunerationandtheperiodforwhichheistoholdoffice.TheDirectorsmayfromtimetotimeprovideforthemanagementandtransactionoftheaffairsoftheCompanyinanyspecifiedlocality,whetherathomeorabroad,insuchmannerastheythinkfit.

14.1.9 Directors’Interests

14.1.9.1 A Director who is in any way, directly or indirectly, interested in a transaction orarrangement with the Company shall, at a meeting of the Directors, declare, inaccordancewiththeCA2006,thenatureofhisinterest.

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14.1.9.2. Provided that he has declared his interest in accordance with paragraph 14.1.9.1, aDirectormaybeaparty toorotherwise interested inany transactionorarrangementwith the Company or in which the Company is otherwise interested and may be adirectororotherofficerorotherwiseinterestedinanybodycorporatepromotedbytheCompanyor inwhich theCompany is otherwise interested.NoDirector so interestedshallbeaccountabletotheCompany,byreasonofhisbeingaDirector,foranybenefitthathederivesfromsuchofficeorinterestoranysuchtransactionorarrangement.

14.1.9.3 ADirectorshallnotvotenorbecountedinthequorumatameetingoftheDirectorsinrespectofamatterinwhichhehasanymaterialinterestotherwisethanbyvirtueofhisinterest in shares, debentures or other securities of, or otherwise in or through theCompany,unlesshisinterestarisesonlybecausethecasefallswithinoneormoreofthefollowingparagraphs:

(a) thegivingtohimofanyguarantee,securityorindemnityinrespectofmoneylentoranobligationincurredbyhimattherequestoforforthebenefitoftheCompanyoranyofitssubsidiaryundertakings;

(b) thegivingtoathirdpartyofanyguarantee,securityorindemnityinrespectofadebtoranobligationoftheCompanyoranyofitssubsidiaryundertakingsforwhichhehasassumedresponsibility inwholeor inpartunderaguaranteeorindemnityorbythegivingofsecurity;

(c) anyproposalconcerningthesubscriptionbyhimofshares,debenturesorothersecuritiesoftheCompanyoranyofitssubsidiaryundertakingsorbyvirtueofhis participating in the underwriting or sub-underwriting of an offer of suchshares,debenturesorothersecurities;

(d) anyproposalconcerninganyothercompanyinwhichheisinterested,directlyorindirectly,whetherasanofficerorshareholderorotherwise,providedthathe and any persons connected with him do not to his knowledge hold aninterest in shares representing 1% or more of any class of the equity sharecapital of such company or of the voting rights available tomembers of therelevantcompany;

(e)(f)

anyproposal relating to an arrangement for thebenefit of the employeesofthe Company or any subsidiary undertaking which does not award to anyDirector as such any privilege or advantage not generally awarded to theemployeestowhomsucharrangementrelates;andanyarrangementforpurchasingormaintainingforanyofficerorauditoroftheCompany or any of its subsidiaries insurance against any liability which byvirtue of any rule of law would otherwise attach to him in respect of anynegligence, breach of duty or breach of trust for which hemay be guilty inrelation to the Company or any of its subsidiaries of which he is a Director,officerorauditor.

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14.1.9.4 Whenproposalsareunder consideration concerning theappointmentof twoormoreDirectors to offices or employment with the Company or any company in which theCompanyisinterestedtheproposalsmaybedividedandconsideredinrelationtoeachDirectorseparatelyand (ifnototherwiseprecluded fromvoting)eachof theDirectorsconcerned shall be entitled to vote andbe counted in thequorum in respect of eachresolutionexceptthatconcerninghisownappointment.

14.1.10 RemunerationofDirectors

14.1.10.1 TheordinaryremunerationoftheDirectorsshallbesuchamountastheDirectorsshallfromtimetotimedetermine(providedthatunlessotherwiseapprovedbytheCompanyin general meeting the aggregate ordinary remuneration of such Directors, includingfees,shallnotexceed£100,000peryear)tobedividedamongtheminsuchproportionandmannerastheDirectorsmaydetermine.SubjecttothepassingofResolution4atthe GeneralMeeting, the Articles shall be amended to provide that unless otherwiseapprovedbytheCompany ingeneralmeetingtheaggregateordinaryremunerationofsuchDirectors,includingfees,shallnotexceed£150,000peryear.

14.1.10.2 Any Director who, by request of the Directors, performs special services for anypurposes of the Company may be paid such reasonable extra remuneration as theDirectorsmaydetermine.

14.1.10.3 TheemolumentsandbenefitsofanyexecutiveDirectorforhisservicesassuchshallbedeterminedby theDirectors andmaybeof anydescription, includingmembershipofanypensionorlifeassuranceschemeforemployeesortheirdependantsor,apartfrommembershipofanysuchscheme,thepaymentofapensionorotherbenefitstohimorhisdependantsonorafterretirementordeath.

14.1.11 RetirementofDirectors

AttheannualgeneralmeetingoftheCompanynextfollowingtheappointmentofaDirectorheshallretire from office. A Director shall also retire from office at or before the third annual generalmeetingfollowingtheannualgeneralmeetingatwhichhelastretiredandwasre-elected.AretiringDirector shall be eligible for re-election. A Director shall be capable of being appointed or re-appointeddespitehavingattainedanyparticularageandshallnotberequiredtoretirebyreasonofhishavingattainedanyparticularage,subjecttotheprovisionsoftheCA2006.

14.1.12 BorrowingPowers

Subject as provided below, theDirectorsmay exercise all the powers of the Company to borrowmoneyandtomortgageorchargeitsundertaking,propertyanduncalledcapital.

TheCompany’sarticlespermitborrowingsofamountsupto50%oftheaggregateof(i)theamountpaidup(orcreditedaspaidup)ontheallottedorissuedsharecapitaloftheCompanyand(ii)theamount standing to the credit of the reserves, whether or not distributable, after adding ordeductinganybalancestandingtothecreditordebitoftheprofitandlossaccount,asadjustedinaccordancewiththeCompany’sarticlesofassociation.

14.1.13 DistributionofRealisedCapitalProfits

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At any time when the Company has given notice in the prescribed form (which has not beenrevoked) to the Registrar of Companies of its intention to carry on business as an investmentcompany(“aRelevantPeriod”)thedistributionoftheCompany’scapitalprofitsshallbeprohibited.The Board shall establish a reserve to be called the capital reserve. During a Relevant Period, allsurplusesarisingfromtherealisationorrevaluationofinvestmentsandallothermoniesrealisedonor derived from the realisation, payment or other dealingwith any capital asset in excess of thebookvaluethereofandallothermonieswhichareconsideredbytheBoardtobeinthenatureofaccretiontocapitalshallbecreditedtothecapitalreserve.SubjecttotheCA2006,theBoardmaydeterminewhetheranyamountreceivedbytheCompanyistobedealtwithasincomeorcapitalorpartlyonewayandpartlytheother.DuringaRelevantPeriod,anylossrealisedontherealisationorpaymentorotherdealingwithinvestments,orothercapitallosses,and,subjecttotheCA2006,anyexpenses, lossor liability (orprovision therefore)which theBoard considers to relate to a capitalitemorwhichtheBoardotherwiseconsidersappropriatetobedebitedtothecapitalreserveshallbecarriedtothedebitofthecapitalreserve.DuringaRelevantPeriod,allsumscarriedandstandingtothecreditofthecapitalreservemaybeappliedforanyofthepurposesforwhichsumsstandingtoanyrevenuereserveareapplicableexceptandprovidedthatduringaRelevantPeriodnopartofthecapitalreserveoranyothermoneyinthenatureofaccretiontocapitalshallbetransferredtotherevenuereservesoftheCompanyorberegardedortreatedasprofitsoftheCompanyavailablefordistributionorappliedinpayingdividendsonanysharesintheCompany.InperiodsotherthanaRelevantPeriod,anyamountstandingtothecreditofthecapitalreservemaybetransferredtotherevenuereservesoftheCompanyorberegardedortreatedasprofitsoftheCompanyavailablefordistributionorappliedinpayingdividendsonanysharesintheCompany.

14.1.14 DurationofCompany(i) TheDirectorsshallprocurethatatthefifteenthannualgeneralmeetingoftheCompany(and

thereafteratfiveyearlyintervals)anordinaryresolutionwillbeproposedtotheeffectthattheCompanyshallcontinueinbeing. Ifsuchresolution isnotpassedtheboardshallwithinfour months of thatmeeting convene a generalmeeting to propose either or both of thefollowing:(a) aspecialresolutionforthereorganisationorreconstructionoftheCompany;or(b) aspecialresolutiontowinduptheCompanyvoluntarily.

(ii) Onany voluntarywinding-up of theCompany, the liquidatormay,with the sanction of an

specialresolutionandanyothersanctionsrequiredbylaw,divideamongstthemembers inspecie the whole or any part of the assets of the Company in such manner as he maydetermine.

14.1.15 GeneralMeetings

TheDirectorsmay,whenever they think fit, conveneageneralmeetingof theCompany. Ifwithin

fifteenminutes (or such longer timenotexceedingonehouras thechairmanof themeetingmaydecide towait) fromthe timeappointed for themeetingaquorum isnotpresent, themeeting, ifconvened on the requisition of members, shall be dissolved and, in any other case, shall standadjournedtosuchday(beingnotlessthantencleardays)andatsuchtimeandplaceastheBoardmaydetermine. Ifatanysuchadjournedmeetingaquorumisnotpresentwithin fifteenminutesfromthetimeappointedforthemeeting,amemberpresentinpersonorbyproxyandentitledtovoteshallbeaquorum.The chairman may, with the consent of the meeting (and shall, if so directed by the meeting)

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adjournanymeetingfromtimetotimeandfromplacetoplace.Nobusinessshallbetransactedatany adjourned meeting other than the business left unfinished at the meeting from which theadjournmenttookplace.

14.2 CREST

CREST is a paperless settlement procedure enabling securities to be evidenced otherwise than by acertificate and transferred otherwise than by a written instrument. The Company’s articles ofassociationareconsistentwithCRESTmembershipandallowfortheholdingandtransferofsharesinuncertificated form subject to the Uncertificated Securities Regulations 2001. The New Shares havebeenmadeeligibleforsettlementinCREST.

15. SPECIFICDISCLOSURESINRESPECTOFCLOSEDENDEDFUNDS

15.1 Octopus intends to use the proceeds of the Offer in accordance with the Company’s objective of

spreading investment riskand inaccordancewith theCompany’s InvestmentPolicy. This InvestmentPolicyisinlinewiththeVCTRulesandtheCompanywillnotdeviatefromthem.Further,inaccordancewith theVCTRules, theCompanywill invest in ordinary shares, in some cases in a small numberofpreferenceshareswhereapplicable,andalwaysinaccordancewithsuchrules.

15.2 TheCompanyisauthorisedandregulatedbytheFCAasaselfmanagedalternativeinvestmentfund.

VCTsneedtomeetanumberofconditionssetout intax legislationinorderfortheVCTtaxreliefstoapply,andcomplywiththerulesandregulationsoftheUKListingAuthority.

15.3 TheCompanyisregulatedbytheVCTRulesinrespectoftheinvestmentstheymakeasdescribedinPart

Three of this document. The Company has appointed PricewaterhouseCoopers of 1 EmbankmentPlace,LondonWC2N6RH(“PwC”)asitsVCTstatusmonitor.PwCwillreporttotheCompanyasapartof itsannualreportingobligations. InrespectofanybreachoftheVCTRules,theCompany,togetherwithPwC,willreportdirectlyandimmediatelytoHMRCtorectifythebreachandannouncethesameimmediatelytotheShareholdersviaaRegulatoryInformationServiceprovider.

15.4 TheCompanywillnot investmore than15%of itsgrossassets inany single company, inaccordance

withtheVCTlegislation,norwilltheCompanycontrolthecompaniesinwhichitinvestsinsuchawayastorenderthemsubsidiaryundertakingsuntilithasobtainedapprovalasaVCTfromHMRC.

15.5 TheCompanywillnotconductanytradingactivitywhichissignificantinthecontextofitsgroup(ifany)asawhole.Nomorethan10%,inaggregate,ofthevalueofthetotalassetsoftheCompanyatthetimean investment ismademaybe invested inother listedclosed-ended investment funds,exceptwherethosefundsthemselveshavepublishedinvestmentpolicieswhichpermitthemtoinvestnomorethan15%oftheirtotalassetsinotherlistedclosed-endedinvestmentfunds.

15.6 TheBoardmustbeable todemonstrate that itwill act independentlyofOctopus. Amajorityof theBoard (including the Chairman)must not be directors, employees, partners, officers, or professionaladvisers of or to,Octopus or any company inOctopus’s groupor any other investment entitywhichtheymanage.

15.7 TheCompanywillnotinvestdirectlyinphysicalcommodities.15.8 TheCompanywillnotinvestinanypropertycollectiveinvestmentundertaking.

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15.9 Otherthanasprovidedforunderitsinvestmentpolicy,theCompanywillnotinvestinanyderivatives,financialinstruments,moneymarketinstrumentsorcurrenciesotherthanforthepurposesofefficientportfoliomanagement (i.e. solely for thepurposeof reducing, transferring or eliminating investmentriskintheunderlyinginvestmentsofthecollectiveinvestmentundertaking,includinganytechniqueorinstrumentusedtoprovideprotectionagainstexchangeandcreditrisks).

15.10 OctopusisresponsibleforthedeterminationandcalculationoftheNAVoftheCompanyonatleasta

sixmonthlybasis.15.11 TheNAV of the Company’s investmentswill be determined byOctopus at least every sixmonths in

accordance with the British Venture Capital Association’s recommendations as set out in the BVCAnotesofguidance. Thevalueof investmentswillbedeterminedona fairvaluebasis. In thecaseofquotedsecurities,fairvalueisestablishedbyreferencetotheclosingbidpriceontherelevantdateorthelasttradedprice,dependingonconventionoftheexchangeonwhichtheinvestmentisquoted.Inthecaseofunquotedinvestments,fairvalueisestablishedbyusingmeasuresofvaluesuchasthepriceof recent transactions, earningsmultiple and net assets. This is consistentwith International PrivateEquity and Venture Capital valuation guidelines. The NAV of the Companywill be communicated toShareholdersviaaRegulatoryInformationServiceatthesamefrequencyasthedeterminations.

15.12 The calculation of the NAV of the Company’s investments will only be suspended in circumstances

where the underlying data necessary to value the investments of the Company cannot readily, orwithout undue expenditure, be obtained. Details of any suspension will be communicated toShareholdersthroughaRegulatoryInformationServiceprovider.

16. CORPORATEGOVERNANCE

TheUKCorporateGovernanceCodepublishedbytheFinancialReportingCouncil inSeptember2014(the “Code”) applies to the Company. The Directors acknowledge the section headed “Comply orExplain” in the preamble to the Code which acknowledges that some provisions may have lessrelevancefor investmentcompaniesand, inparticular,considersomeareas inappropriateduetothesizeandnatureofthebusinessoftheCompany.Accordingly,theprovisionsoftheCodearecompliedwithsavethat(i)theCompanydoesnothaveachiefexecutiveofficeroraseniorindependentdirector(the Board does not consider this necessary for the size of the Company), (ii) newDirectors do notreceiveafull,formalandtailoredinductiononjoiningtheBoardandsuchmattersareaddressedonanindividualbasisastheyarise(iii)theCompanyconductsaformalreviewastowhetherthereisaneedforaninternalauditfunction,howevertheDirectorsdonotconsiderthataninternalauditwouldbeanappropriatecontrolforaVCT(iv)theCompanydoesnothavearemunerationcommitteegiventhesizeoftheCompanyandassuchtheBoardasawholedealswithanymattersofthisnatureand(v)astheCompanyhasnomajorshareholders,theShareholdersarenotgiventheopportunitytomeetanynon-executiveDirectorsataspecificmeetingotherthantheannualgeneralmeeting.

17. TAKEOVERSANDMERGERS

17.1 MandatorytakeoverbidsThe City Code on Takeovers andMergers (the “Takeover Code”) applies to all takeover andmergertransactions in relation to the Company, and operates principally to ensure that shareholders aretreated fairly and are not denied an opportunity to decide on the merits of a takeover, and thatshareholders of the same class are afforded equivalent treatment. The Takeover Code provides anorderlyframeworkwithinwhichtakeoversareconductedandthePanelonTakeoversandMergers(the

I:16.4

I:16.3

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“Panel”)hasnowbeenplacedonastatutoryfooting.TheTakeoversDirectivewasimplementedintheUK in May 2006 and since 6 April 2007 has effect through the CA 2006. The Directive applies totakeovers of companies registered in an EU member state and admitted to trading on a regulatedmarketintheEUorEEA.TheTakeoverCode isbaseduponanumberofGeneralPrincipleswhichareessentiallystatementsofstandards of commercial behaviour. General PrincipleOne states that all holders of securities of anofferee company of the same classmust be afforded equivalent treatment and if a person acquirescontrolofacompanytheotherholdersofsecuritiesmustbeprotected.ThisisreinforcedbyRule9ofthe Takeover Codewhich requires a person, togetherwith persons acting in concert with him, whoacquires shares carrying voting rightswhich amount to 30% ormore of the voting rights tomake ageneraloffer. “Votingrights”forthesepurposesmeansall thevotingrightsattributabletothesharecapitalofacompanywhicharecurrentlyexercisableatageneralmeeting.Ageneralofferwillalsoberequiredwhere apersonwho, togetherwithpersons acting in concertwithhim, holdsnot less than30% but not more than 50% of the voting rights, acquires additional shares which increase hispercentage of the voting rights. Unless the Panel consents, the offer must be made to all othershareholders,beincash(orhaveacashalternative)andcannotbeconditionalonanythingotherthanthe securing of acceptances which will result in the offeror and persons acting in concert with himholdingsharescarryingmorethan50%ofthevotingrights.TherearenotinexistenceanycurrentmandatorytakeoverbidsinrelationtotheCompany.

17.2 Squeezeout

Section979of theCA2006provides that if,withincertain time limits,anoffer ismade for thesharecapitaloftheCompany,theofferorisentitledtoacquirecompulsorilyanyremainingsharesifithas,byvirtueofacceptancesoftheoffer,acquiredorunconditionallycontractedtoacquirenotlessthan90%in value of the shares towhich the offer relates and in a casewhere the shares towhich the offerrelatesarevoting shares,not less than90%of thevoting rights carriedby thoseshares. Theofferorwouldeffectthecompulsoryacquisitionbysendinganoticetooutstandingshareholderstellingthemthat itwillcompulsorilyacquiretheirsharesandthen,sixweeksfromthedateofthenotice,paytheconsiderationforthesharestotherelevantCompanytoholdontrustfortheoutstandingshareholders.TheconsiderationofferedtoshareholderswhosesharesarecompulsorilyacquiredundertheCA2006must,ingeneral,bethesameastheconsiderationavailableunderthetakeoveroffer.

17.3 Sellout

Section983oftheCA2006permitsaminorityshareholdertorequireanofferortoacquireitssharesiftheofferorhasacquiredorcontractedtoacquiresharesinacompanywhichamounttonot lessthan90%,invalueofallthevotingsharesinthecompanyandcarryingnotlessthan90%ofthevotingrights.Certaintimelimitsapplytothisentitlement.Ifashareholderexercisesitsrightsundertheseprovisions,theofferorisboundtoacquirethosesharesonthetermsoftheofferoronsuchothertermsasmaybeagreed.

18. NOTIFICATIONSOFSHAREHOLDINGS

Theprovisionsofdisclosureguidanceandtransparencyrule5("DGTR5")willapplytotheCompanyandits Shareholders. DGTR 5 sets out the notification requirements for Shareholders and the CompanywherethevotingrightsofaShareholderexceed,reachorfallbelowthethresholdof3%andeach1%thereafter up to 100%. DGTR 5 provides that disclosure by a Shareholder to the Companymust be

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madewithintwotradingdaysoftheeventgivingrisetothenotificationrequirementandtheCompanymust release details to a regulatory information service as soon as possible following receipt of anotificationandbynolaterthantheendofthetradingdayfollowingsuchreceipt.

19. GENERAL

19.1 TheestimatedcostsandexpensesrelatingtotheOffer,assumingfullsubscription,all investorsbeing

AdvisedInvestors,andallchoosingtopaytheiradvisorsa2.5%upfrontfee,payablebytheCompanyisestimated to amount to approximately £1.1 million in aggregate. On the above assumptions, theaggregatetotalnetproceedsoftheOffer,afterallfees,isexpectedtobeapproximately£18.9million.TheMergerwill not result in anyproceedsbeing raisedby theCompany. The aggregate anticipatedcostsofundertakingtheMergerareapproximately£331,000.

19.2 GrantThorntonUKLLP,charteredaccountantsof3140RowanPlace,JohnSmithDrive,OxfordBusiness

Park South, Oxford OX4 2WB have been the auditor of the Company since its incorporation. GrantThorntonUKLLPhavegivenunqualifiedauditreportsonthestatutoryaccountsoftheCompanyforallofthefinancialyearssetoutinPartFivewithinthemeaningofSection495oftheCA2006.Noneofthose reports contained any statements under Section 237(2) or (3) of the CA 2006. The statutoryaccountssetoutinPartFivehavebeendeliveredtotheRegistrarofCompaniesinEnglandandWalespursuanttoSection242oftheCA2006.

19.3 TheCompanyshalltakeallreasonablestepstoensurethatitsauditorsareindependentofitandwill

obtainwrittenconfirmationfromitsauditorsthatitcomplieswithguidelinesonindependenceissuedbyitsnationalaccountancyandauditingbodies.

19.4 Howard Kennedy’s office address is at 1 London Bridge, London SE1 9BG. Howard Kennedy is

regulatedbytheFinancialConductAuthorityandisactinginthecapacityasSponsortotheCompany. 19.5 HowardKennedyhasgivenandhasnotwithdrawn itswritten consent to the issueof thisdocument

withtheinclusionofitsnameandreferencestoitintheformandcontextinwhichtheyappear.

19.6 ThestatementsattributedtoOctopusinthisdocumenthavebeenincludedintheformandcontextin

whichtheyappearwiththeconsentandauthorisationofOctopus.Octopusacceptsresponsibility forthose statements and to the best of the knowledge and belief of Octopus, which has taken allreasonablecaretoensurethatsuchisthecase,thosestatementsareinaccordancewiththefactsanddonotomitanythinglikelytoaffecttheimportofsuchinformation.

19.7 Therearenopatentsorotherintellectualpropertyrights, licences, industrial,commercialorfinancial

contracts or new manufacturing processes which are material to the Company’s business orprofitability.

19.8 TheCompanydoesnotassumeresponsibilityforthewithholdingoftaxatsource.19.9 Therehasbeennosignificant change in the financialor tradingpositionof theCompany since31 July

2016,thedatetowhichthelatestunauditedhalf-yearfinancialinformationhasbeenpublished,tothedateofthisdocument.

19.10 Therehavebeennosignificant factors,whethergovernmental,economic, fiscal,monetaryorpolitical,including unusual or infrequent events or new developments nor any known trends, uncertainties,demands, commitments or events that are reasonably likely to have an effect on the Company’s

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prospects or which have materially affected the Company’s income from operations so far as theCompanyandtheDirectorsareaware.

19.11Shareholderswillbeinformed,bymeansofthehalf-yearand/orannualreportorthroughaRegulatory

InformationServiceannouncementiftheinvestmentrestrictionswhichapplytotheCompanyasaVCTdetailedinthisdocumentarebreached.

19.12 TheCompany’scapitalresourcesarerestrictedinsofarastheymaybeusedonlyinputtingintoeffectthe Company’s investment policy, as set out in this document. There are no firm commitments inrespectofanyof theCompany’sprincipal future investments. Asat31 July2016, theCompanyhad£35.6million of uninvested cash which has been retained for working capital and follow-on or newinvestments.

19.13 All Shareholders have the same voting rights in respect of the share capital of the Company. The

Companyisnotawareofanypersonwho,directlyorindirectly,exercisesorcouldexercisecontrolovertheCompany,norofanyarrangements,theoperationofwhich,mayatasubsequentdateresult inachangeofcontroloftheCompany.

19.14TheCompanyhasnoemployees.

19.15 Thetypical investorforwhomtheCompanyisdesignedisaUKtaxpayerover18yearsofagewithaninvestment range of between £5,000 and £200,000who, having regard to the risk factors set out atpages15to16,considerstheInvestmentPolicytobeattractive.Thismayincluderetail,institutionalandsophisticated investors and high net worth individuals who already have a portfolio of non-VCTinvestments.

19.16TheCompanydoesnothaveanymajorshareholderswithdifferentvotingrights.

19.17 Application has beenmade for the admission of theNew Shares to be listed on theOfficial List andapplicationwillbemadefortheNewSharestobeadmittedtotradingontheLondonStockExchange’smarketfor listedsecurities.TheNewShareswillbe inregisteredform. If, following issue,recipientsofNew Shareswish to hold theirNew Shares in uncertificated form they should contact the Company’sregistrar.

19.18 AllthirdpartyinformationinthisProspectushasbeenidentifiedassuchbyreferencetoitssourceandineach instancehasbeenaccurately reproducedand, so far as theCompany is awareand is able toascertain from informationpublishedby the relevantparty,no factshavebeenomittedwhichwouldrenderthereproducedinformationinaccurateormisleading.

19.19 Octopus will provide safe custody to the Company in respect of the un-invested cash, general

investmentanddealingservicesonadiscretionarybasisandotherrelatedfacilitieswhichmayincludethe following investments: shares in investee companies, debenture stock, loan stock, bonds, units,notes, certificates of deposit, commercial paper or other debt instruments,municipal and corporateissues, depository receipts, cash term deposits, moneymarket securities, unit trusts, mutual funds,OEICs, investment funds and similar funds and schemes in theUnitedKingdomor elsewhere. Theseservicesexcludeanytransactioninrelationtofuturesandoptionsorotherderivativetypeinstrumentsorcommodity(orderivativethereof)byOctopus.

19.20 TheexistingissuedSharesintheCompanywillrepresent73.7%oftheenlargedordinarysharecapitalof

theCompanyimmediatelyfollowingcompletionoftheSchemeandtheOffer,assuming(i)theOfferis

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fully subscribedatanOfferPriceof85.2pand (ii)38,899,060SchemeSharesare issuedpursuant totheMergerand,on thatbasis, Shareholderswhodonot receiveOffer Sharesor SchemeShareswill,therefore,bedilutedby26.3%.

19.21 TheexistingissuedSharesintheCompanywillrepresent81.8%oftheenlargedordinarysharecapitalof

theCompanyimmediatelyfollowingcompletionoftheScheme,assuming(i)theOfferdoesnotproceedand(ii)38,899,060SchemeSharesareissuedpursuanttotheMergerand,onthatbasis,ShareholderswhodonotreceiveSchemeShareswill,therefore,bedilutedby18.2%.

19.22 TheexistingissuedSharesintheCompanywillrepresent88.2%oftheenlargedordinarysharecapitalof

theCompanyimmediatelyfollowingcompletionoftheOffer,assuming(i)theOfferisfullysubscribedatanOfferPriceof85.2pand(ii)theSchemedoesnotproceedand,onthatbasis,ShareholderswhodonotreceiveOfferShareswill,therefore,bedilutedby11.8%.

19.23 The Company, the Directors and the Proposed Director consent to the use of the Prospectus, and

accept responsibility for the content of the Prospectus, with respect to subsequent resale or finalplacementofsecuritiesby financial intermediaries, fromthedateof theProspectusuntil thecloseofthe Offer. The Offer is expected to close on or before 3 November 2017. There are no conditionsattachingtothisconsent.FinancialintermediariesmayusetheProspectusonlyintheUK.

19.24 Information on the terms and conditions of the Offer will be given to investors by financial

intermediariesatthetimethattheOfferisintroducedtoinvestors.Anyfinancialintermediaryusingthe Prospectus must state on its website that it is using the Prospectus in accordance with theconsentsetoutinparagraph19.23above.

20. DOCUMENTSAVAILABLEFORINSPECTION

Copiesofthefollowingdocumentswillbeavailableforinspectionduringnormalbusinesshoursonanyweekday (Saturdays and public holidays excepted) at the registered offices of the Company andHowardKennedywhilsttheOfferremainsopen:

20.1 theArticles;20.2 thematerialcontractsreferredtoinparagraph8ofPartSevenabove;20.3 thehalfyearreportsoftheCompanyforthe6monthperiodsending31July2015and31July2016and

theannualaccountsfortheperiodsending31January2014,31January2015and31January2016;20.4 thehalfyearreportsofEclipseforthe6monthperiodsending31March2015and31March2016and

theannualaccountsfortheperiodsending30September2013,30September2014and30September2015;

20.5 theCircularandtheEclipseCircular;and20.6 thisdocument.4November2016

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DEFINITIONSThefollowingdefinitionsapplythroughoutthisdocument,unlessotherwiseexpressedorthecontextotherwiserequires:

“Acts” CA1985andCA2006

“Admission” theadmissionofNewSharestotradingontheLondonStockExchange’smainmarketforlistedsecurities

“AdvisedInvestors” investors under the Offer who receive advice from their financialintermediaries

“Applicant” apersonapplyingforOfferSharesundertheOffer

“Application” anapplicationforOfferSharesundertheOffer

“ApplicationForm” the application form relating to the Offer which can be found on theCompany’swebsite

“Articles” thearticlesofassociationoftheCompany

“Board”or"Directors" theboardofdirectorsoftheCompany

“Boards” theBoardandtheEclipseBoard

“CA1985” CompaniesAct1985

“CA2006” CompaniesAct2006

“CapitaAssetServices” atradingdivisionofCapitaRegistrarsLimited

“Circular” thecirculartoShareholdersdated4November2016

"Company" OctopusApolloVCTplc

“Companies” theCompanyandEclipse

“Dividend Reinvestment Scheme”or“DRIS”

theCompany’sdividendreinvestmentscheme,detailsofwhicharesetoutinPartTwo

"Eclipse" OctopusEclipseVCTplc

"Eclipse Board" or "EclipseDirectors"

theboardofdirectorsofEclipse

"EclipseCircular" thecirculartoEclipseShareholdersdated4 November 2016

"EclipseFirstGeneralMeeting" thegeneralmeetingofEclipsetobeheldon7December2016(oranyadjournmentthereof)

"EclipseGeneralMeetings" the Eclipse First General Meeting and the Eclipse Second GeneralMeeting

"EclipseSecondGeneralMeeting" thegeneralmeetingofEclipsetobeheldon19December2016(oranyadjournmentthereof)

"EclipseShares" ordinarysharesof10peachinthecapitalofEclipse

"EclipseShareholders" holdersofEclipseShares(andeachan“EclipseShareholder”)

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“EnlargedCompany” theCompanyfollowingimplementationoftheScheme

“FCA” theFinancialConductAuthority

“FSMA” theFinancialServicesandMarketsAct2000,asamended

“GeneralMeeting” thegeneralmeetingoftheCompanytobeheldon12December 2016(oranyadjournmentthereof)

“GeneralMeetings” theGeneralMeetingandtheEclipseGeneralMeetings

“HMRC” HMRevenueandCustoms

“HowardKennedy” HowardKennedyCorporateServicesLLP

“IA1986” TheInsolvencyAct1986,asamended

"InvestmentPolicy" theCompany'sinvestmentpolicyfromtimetotime

“ITA2007” IncomeTaxAct2007,asamended

“KnowledgeIntensiveCompany” acompanysatisfyingtheconditionsinSection331(A)ofPart6ITA2007of the proposed draft legislation. These rules are subject to RoyalAssent.

“Liquidators” WilliamDuncanandAdrianAllenofRSMRestructuringAdvisoryLLP,beingtheproposedliquidatorsforEclipse

“ListingRules” thelistingrulesoftheUKLA

“LondonStockExchange” LondonStockExchangeplc

"MarketAbuseRegulation" MarketAbuseRegulation(596/2014/EU)

‘‘MergerRegulations’’ VentureCapitalTrusts(Winding-upandMergers)(Tax)Regulations2004

"MergerValue" thevalueofaSharecalculatedinaccordancewiththeformulasetoutinPartOneofthisdocument

“NAV” netassetvalue

“NewShares” the SchemeShares and/or theOffer Shares, as applicable (andeacha“NewShare”)

“Octopus”, the “Manager” or the“ReceivingAgents”

OctopusInvestmentsLimited

“OctopusVCT” anyventurecapitaltrust(whetheritstillexistsornot)whichis,orwasatanytime,managedbyOctopus

“Offer”

theofferforsubscriptionbytheCompanyforOfferSharesinrespectofthetaxyears2016/17and2017/18containedinthisdocument

“OfferAgreement” the offer agreement dated 4 November 2016 between the Company,theDirectors, theManagerandHowardKennedy,detailsofwhicharesetoutinPartSeven

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“OfferPrice” thepriceperOfferShare,assetoutinPartTwo

“OfferShares” SharesbeingofferedundertheOffer(andeachan“OfferShare”)

“OfficialList” theofficiallistmaintainedbytheUKListingAuthority

"OVCT" OctopusVCTplc(dissolved)

"OVCT2" OctopusVCT2plc(inliquidation)

“Proposals” theproposals toeffect theSchemeand theOffer, and toapprove theResolutions

“ProposedDirector” AlexHambro,whowillbecomeadirectoroftheCompanyintheeventthattheMergerproceeds

“Prospectus” thisdocument

“ProspectusRules” the prospectus rules made in accordance with the EU ProspectusDirective2003/71/EC

“QualifyingCompany” a company satisfying the requirements of Chapter 4 of Part 6 of ITA2007

“QualifyingInvestments” shares in, or securities of, aQualifying Company held by a VCTwhichmeetstherequirementsdescribedinchapter4ofPart6ITA2007

“QualifyingSubscriber” anindividualwhosubscribesforNewSharesandisaged18oroverandsatisfiestheconditionsofeligibilityfortaxreliefavailabletoinvestorsinaVCT

“RegulatoryInformationService”

a regulatory information service that is on the list of regulatoryinformationservicesmaintainedbytheFCA

“Resolutions” the resolutions to be proposed at the General Meetings (and each a“Resolution”)

“RiskFinanceStateAid” StateaidreceivedbyacompanyasdefinedinSection280B(4)ofITA

"Roll-OverValue" thevalueofanEclipseSharecalculatedinaccordancewiththeformulasetoutinPartOneofthisdocument

‘‘Scheme’’or“Merger” theproposedmergeroftheCompanywithEclipsebymeansofplacingEclipse intomembers’voluntary liquidationpursuant toSection110ofIA 1986 and the acquisition by the Company of all of the assets andliabilitiesof Eclipse in consideration for SchemeShares, furtherdetailsofwhicharesetoutinPartOneofthisdocument

‘‘SchemeCalculationDate’’ thedateonwhichthenumberofSchemeSharestobeissuedpursuanttotheSchemewillbecalculated,anticipatedasbeingafterthecloseofbusinesson16December2016

‘‘SchemeEffectiveDate’’ thedateonwhich theSchemewillbecompleted,anticipatedasbeing19December2016

‘‘SchemeRecordDate’’ therecorddatetowhichentitlementswillbeallocatedpursuantto

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theScheme,anticipatedasbeing16December2016

“SchemeShares” the Shares being issued subject to the Scheme (and each a “SchemeShare”)

“Shareholders” holdersofShares(andeacha“Shareholder”)

“Shares” ordinarysharesof10peach inthecapitaloftheCompany(andeacha“Share”)

“TCGA1992” TaxationofChargeableGainsAct1992

“TermsandConditions” thetermsandconditionsofApplication,containedinthisdocumentonpages83to88

‘‘TransferAgreement’’ theagreementbetweenEclipse(actingthroughtheLiquidators)andtheCompanyforthetransferofalloftheassetsandliabilitiesofEclipse,bytheLiquidators,totheCompanypursuanttotheScheme

“UKLA” theUKListingAuthority,beingtheFinancialConductAuthorityactinginitscapacityasthecompetentauthorityforthepurposesofPartVIoftheFinancialServicesandMarketAct2000

“venturecapitaltrust”or“VCTs” a companywhich is, for the timebeing,approvedasaventurecapitaltrustunderSection259oftheITA2007

“VCTRules” Part 6 ITA 2007 and every other statute (including any orders,regulationsorother subordinate legislationmadeunder them) for thetimebeinginforceconcerningVCTs

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TERMSANDCONDITIONSThe followingtermsandconditionsapply to theOffer.Thesectionheaded“ApplicationProcedure”assetoutbelowalsoformspartofthesetermsandconditionsofApplication.1. Themaximumamount tobe raisedby theCompany is£20million.TheOffer is conditionalupon the

passing by Shareholders of Resolution 2 at the GeneralMeeting. The Offer will close earlier if fullysubscribed.TheBoardreservestherighttoclosetheOfferearlierandtoacceptApplicationsandissueOfferSharesatanytimefollowingthereceiptofvalidapplications.

2. Thecontractcreatedwith theCompanyby theacceptanceofanApplication (oranyproportionof it)

undertheOfferwillbeconditionalonacceptancebeinggivenbytheReceivingAgentsandadmissionoftheOffer Shares allotted in the Company subject to theOffer to theOfficial List (save as otherwiseresolvedbytheBoard).

3. TherightisreservedbytheCompanytopresentallchequesandbanker’sdraftsforpaymentonreceipt

and to retain share certificates and Application monies pending clearance of successful Applicants’chequesandbankers’drafts.TheCompanymaytreatApplicationsasvalidandbindingevenifnotmadeinall respects inaccordancewiththeprescribed instructionsandtheCompanymay,at itsdiscretion,acceptanApplicationinrespectofwhichpaymentisnotreceivedbytheCompany.IfanyApplicationisnot accepted in full or if any contract created by acceptance does not become unconditional, theApplicationmoniesor,asthecasemaybe,thebalancethereof(savewheretheamountislessthantheOfferPriceofoneSharewillbedonatedtocharity)willbereturned(withoutinterest)byreturningeachrelevantApplicant’schequeorbanker’sdraftorbycrossedchequeinfavouroftheApplicant,throughthe post at the risk of the person(s) entitled thereto. In the meantime, Application monies will beretainedbytheReceivingAgentsinaseparateaccount.

4. BycompletinganddeliveringanApplicationForm,you:

I. irrevocablyoffertosubscribeforOfferSharesintheCompanyundertheOfferinthemonetaryamountspecifiedinyourApplicationForm(orsuchlesseramountforwhichyourApplicationisaccepted),whichshallbeusedtopurchasetheOfferSharesattheOfferPrice,determinedbydividingthemostrecentlyannouncedNAVperOrdinaryShareoftheCompanyby0.945toallowforissuecosts,onthetermsofand subject to this document and subject to the memorandum and articles of association of theCompany.WheretheSharepricefortheCompanyhasbeendeclaredex-dividendontheLondonStockExchange,theNAVusedforpricingundertheOfferwillbeex-dividend.InrespectoftheOffer,theNAVperSharewillberoundeduptoonedecimalplaceandthenumberofOfferSharestobeissuedwillberoundeddowntothenearestwholenumber(fractionalOfferShareswillnotbeallotted);

II. agree that your Applicationmay not be revoked and that this paragraph shall constitute a collateralcontractbetweenyouandtheCompanywhichwillbecomebindingupondespatchbypostto,or(inthecaseofdeliverybyhand)onreceiptby,theReceivingAgentsofyourApplicationForm;

III. agreeandwarrantthatyourchequeorbanker’sdraftmaybepresentedforpaymentonreceiptandwillbehonouredon first presentation andagree that if it is not sohonoured youwill notbeentitled toreceive certificates in respect of theOffer Shares allotted to you until youmake payment in clearedfunds for suchOffer Sharesand suchpayment is acceptedby theCompany in its absolutediscretion(whichacceptanceshallbeonthebasisthatyouindemnifyitandtheReceivingAgentsagainstallcosts,damages, losses, expenses and liabilities arising out of or in connection with the failure of yourremittance to be honoured on first presentation) and you agree that, at any time prior to theunconditionalacceptancebytheCompanyofsuchlatepayment,theCompanymay(withoutprejudiceto theirother rights) rescind theagreement to subscribesuchOfferSharesandmay issuesuchOfferSharestosomeotherperson,inwhichcaseyouwillnotbeentitledtoanypaymentinrespectofsuchOffer Shares, other than the refund to you, at your risk, of the proceeds (if any) of the cheque orbanker’sdraftaccompanyingyourApplication,withoutinterest;

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IV. agreethat, inrespectofthoseOfferSharesforwhichyourApplicationisreceivedandisnotrejected,yourApplicationmaybeacceptedattheelectionoftheCompanyeitherbynotificationtotheLondonStockExchangeofthebasisofallocationandallotment,orbynotificationofacceptancethereoftotheReceivingAgents;

V. agree that anymonies refundable to you by the Companymay be retained by the Receiving Agentspendingclearanceofyourremittanceandanyverificationofidentitywhichis,orwhichtheCompanyorthe Receiving Agents may consider to be, required for the purposes of the Money LaunderingRegulations2007andthatsuchmonieswillnotbearinterest;

VI. authorisetheReceivingAgentstosendsharecertificates inrespectofthenumberofOfferSharesforwhichyourApplicationisacceptedand/oracrossedchequeforanymoniesreturnable,bypost,withoutinterest,toyouraddresssetoutintheApplicationFormandtoprocurethatyournameisplacedontheregisterofmembersoftheCompanyinrespectofsuchNewShares;

VII. agree that all Applications, acceptances of Applications and contracts resulting therefrom shall begovernedinaccordancewithEnglish law,andthatyousubmittothejurisdictionoftheEnglishcourtsand agree that nothing shall limit the right of the Company or Octopus to bring any action, suit orproceedingarisingoutof,orinconnectionwithanysuchApplications,acceptancesofApplicationsandcontractsinanyothermannerpermittedbylaworanycourtofcompetentjurisdiction;

VIII. confirmthat, inmakingsuchApplication,youarenot relyingonany informationor representation inrelation to theCompanyother than the informationcontained in thisdocumentandaccordingly youagreethatnopersonresponsiblesolelyorjointlyforthisdocument,thecovercorrespondenceoranypart thereof or involved in the preparation thereof shall have any liability for such information orrepresentation(saveforfraudulentmisrepresentationorwilfuldeceit);

IX. irrevocablyauthorisetheReceivingAgentstodoallthingsnecessarytoeffectregistrationofanyOfferSharessubscribedbyorissuedtoyouintoyournameandauthoriseanyrepresentativeoftheReceivingAgentstoexecuteanydocumentrequiredtherefore;

X. agreethat,havinghadtheopportunitytoreadthisdocument,youshallbedeemedtohavehadnoticeofallinformationandstatementsconcerningtheCompanyandtheOffercontainedtherein;

XI. confirmthatyouhavereviewedtherestrictionscontainedinparagraph6belowandwarrantthatyouare not a “US Person” as defined in the United States Securities Act of 1933 (“Securities Act”) (asamended),noraresidentofCanadaandthatyouarenotapplyingforanyShareswithaviewtotheiroffer,saleordeliverytoorforthebenefitofanyUSPersonoraresidentofCanada;

XII. declarethatyouareanindividualaged18orover;

XIII. agree thatalldocumentsandchequessentbypost to,byoronbehalfofeither theCompanyor the

ReceivingAgents,willbesentattheriskofthepersonentitledthereto;

XIV. agree, on request by the Company or Octopus, to disclose promptly in writing to Octopus, anyinformation which Octopus may reasonably request in connection with your Application including,without limitation,satisfactoryevidenceof identity toensurecompliancewiththeMoneyLaunderingRegulations and authorise the Company or Octopus to disclose any information relating to yourApplicationastheCompanyorOctopusconsiderappropriate;

XV. agree thatOctopuswillnot treatyouas itscustomerbyvirtueofyourApplicationbeingacceptedoroweyouanydutiesorresponsibilitiesconcerningthepriceoftheOfferSharessubjecttotheOfferorthesuitabilityforyouofaninvestmentinOfferSharessubjecttotheOfferorberesponsibletoyouforprovidingtheprotectionsaffordedtoitscustomers;

XVI. whereapplicable,authorisetheCompanytomakeonyourbehalfanyclaimtorelieffromincometaxinrespectofanydividendspaidbytheCompany;

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XVII. declarethattheApplicationFormhasbeencompletedtothebestofyourknowledge;

XVIII. undertake that you will notify the Company if you are not or cease to be either a VCT qualifying

subscriberorbeneficiallyentitledtotheOfferShares;

XIX. declarethata loanhasnotbeenmadetoyouoranyassociate,whichwouldnothavebeenmadeorwouldnothavebeenmadeonthesameterms,butforyouofferingtosubscribefor,oracquiring,OfferShares under the Offer and that such Offer Shares are being acquired for bona fide commercialpurposesandnotaspartofaschemeorarrangement,themainpurposeofwhichistheavoidanceoftax;and

XX. agree that information provided on the Application Form may be provided to the registrars andReceivingAgentstoprocessshareholdingsdetailsandsendnotificationstoyou.

5. Nopersonreceivingacopyofthisdocument,coveringcorrespondenceoranApplicationForminany

territoryotherthantheUK,maytreatthesameasconstitutinganinvitationoroffertohim,norshouldhe inanyeventusesuchApplicationFormunless, intherelevantterritory,suchan invitationoroffercouldlawfullybemadetohimorsuchApplicationFormcouldlawfullybeusedwithoutcontraventionofanyregulationsorotherlegalrequirements.ItistheresponsibilityofanypersonoutsidetheUKwishingtomakeanApplicationtosatisfyhimselfasto fullobservanceof the lawsofanyrelevantterritory inconnectiontherewith,includingobtaininganyrequisitegovernmentalorotherconsents,observinganyotherformalitiesrequiringtobeobservedinsuchterritoryandpayinganyissue,transferorothertaxesrequiredtobepaidbysuchterritory.

6. TheOffer Shares have not been andwill not be registered under theUnited States SecuritiesAct of

1933, as amended, andmaynotbeofferedor sold in theUnited StatesofAmerica, its territoriesorpossessionsorotherareassubjecttoitsjurisdiction(the“USA”).Inaddition,theOfferShareshavenotbeenandwillnotberegisteredundertheUnitedStatesInvestmentCompanyActof1940,asamended.OctopuswillnotberegisteredundertheUnitedStatesInvestmentAdvisersActof1940,asamended.NoApplicationwillbeacceptedifitbearsanaddressintheUSA.

7. Thebasisof allocationwill bedeterminedby theCompany (after consultationwithOctopus) in their

absolute discretion. The right is reserved by the Board to reject inwhole or in part and scale downand/orballotanyApplicationoranypartthereofincluding,withoutlimitation,Applicationsinrespectofwhich any verification of identity which the Company or Octopus considermay be required for thepurposesof theMoneyLaunderingRegulationshasnotbeensatisfactorily supplied.Dealingsprior tothe issue of certificates for Offer Shares will be at the risk of Applicants. A person so dealingmustrecognisetheriskthatanApplicationmaynothavebeenacceptedtotheextentanticipatedoratall.

8. MoneyLaunderingRegulations

Investorsshouldbeawareofthefollowingrequirementsinrespectoftheabovelaw.

Under the Money Laundering Regulations, Octopus is required to check the identity of clients whoinvest over £10,000 or who invest using third party cheques. Octopus may therefore undertake anelectronic search for thepurposesof verifyingyour identity.Todo soOctopusmaycheck thedetailsyou supply against your particulars on any database (public or other) to which Octopus has access.Octopusmayalsouseyourdetails inthefuturetoassistothercompaniesforverificationpurposes.Arecord of this searchwill be retained. IfOctopus cannot verify your identity itmay ask for a recent,originalutilitybillandanoriginalHMRCTaxNotificationoracopyofyourpassportcertifiedbyabank,solicitororaccountantfromyouoraClientVerificationCertificatefromyourIFA.

Ifwithinareasonableperiodoftimefollowingarequestforverificationofidentity,andinanycasebynolaterthan3.00pmontherelevantdateofallotment,Octopushasnotreceivedevidencesatisfactorytoitasaforesaid,Octopus,atitsabsolutediscretion,mayrejectanysuchApplicationinwhicheventtheremittancesubmittedinrespectofthatApplicationwillbereturnedtotheApplicant(withoutprejudice

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totherightsoftheCompanytoundertakeproceedingstorecoveranylosssufferedbythemasaresultofthefailuretoproducesatisfactoryevidenceofidentity).

Yourchequeorbankers’draftmustbedrawninsterlingonanaccountatabranch(whichmustbeintheUnitedKingdom,theChannelIslandsortheIsleofMan)ofabankwhichiseitheramemberoftheChequeandCreditClearingCompanyLimitedortheCHAPSClearingCompanyLimited,amemberoftheScottish Clearing Banks Committee or the Belfast Clearing Committee or which has arranged for itscheques or bankers’ drafts to be cleared through facilities provided for bymembers of any of thosecompaniesorassociationsandmustbeartheappropriatesortingcodeinthetoprighthandcorner.TherightisreservedtorejectanyApplicationForminrespectofwhichthechequeorbankers’drafthasnotbeenclearedonfirstpresentation.

9. CostsoftheOffer

Forallinvestors,theOfferPriceperSharewillbedeterminedbyaformulareflectingtheNAVperShareadjustedforanallowanceforthemajorityofthecostsoftheOffer.Theformula is:themostrecentlyannounced NAV per Share, divided by 0.945. Investors who are existing, or who were previously,shareholdersofanyOctopusVCTwillbenefitfromthecostsoftheOfferbeingreducedby0.5%.

InconsiderationforthepromotionandinvestmentmanagementservicesthatOctopusprovidestotheCompany, the Company will pay an initial charge of 3% of the gross sums invested in the Offer toOctopus.ThisispayableinthesamewayonallsubscriptionstotheOffer.FromthissumOctopuswilldischargeallexternalcostsofadviceandtheirowncostsinrespectoftheOffer.Inaddition,therearethenfourcategoriesofoptions,whicharedeterminedbythecircumstancesofeachinvestorandtheirexplicit instructions, inrespectofwhichpaymentscanbemadetoadvisersandother intermediaries.Theseareasfollows:

1) Adirectinvestment

Investors who have not invested their money through a financial intermediary/adviser andhaveinvesteddirectlyintotheCompany.In consideration for the promotion, investment management and secretarial services thatOctopus provides to the Company, if an application is made directly (not through anintermediary) then theCompanywill payOctopusanadditional initial chargeof 2.5%of theinvestment amount and an additional annual ongoing charge of 0.5% of the investmentamount’slatestNAVforuptonineyears,providedtheinvestorcontinuestoholdtheShares.

2) Anadvisedinvestmentwhereadviceisreceivedforanupfrontfeewithanongoingadvisercharge

Investorswho have invested in theOffer through a financial intermediary/adviser and havereceivedupfrontadviceandwillreceiveongoingadvice.

TheCompanycanfacilitateapaymentonbehalfofaninvestortoanintermediary/adviser(an‘initialadvisercharge’)ofupto2.5%oftheinvestmentamount.Iftheinvestorhasagreedwithhis/her intermediary/adviser to pay a lower initial adviser charge, the balance (up to amaximumof2.5%)will beused for the issueandallotmentofOffer Shares for the investor,issuedat themost recentlyannouncedNAVperShare,dividedby0.945asdescribed inPartTwo.

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TheCompanycanalsofacilitateannualpaymentstoanintermediary/adviser(‘ongoingadvisercharges’) inrespectofongoingadvisoryservicesprovidedbythe intermediary/adviser totheinvestorofupto0.5%perannumoftheinvestmentamount’slatestNAVforuptonineyearswhilst the investor continues to hold the Offer Shares. If the investor chooses to pay theiradviserlessthan0.5%annually,theremainingamountwillbeusedfortheissueandallotmentof additional Offer Shares for the investor, at the then most recently announced NAV perShare.AnyresidualamountlessthanthecostofanOfferSharewillbedonatedtocharity.

If the investor terminates their relationshipwith the intermediary/adviser thentheCompanywillnotmakeanyfurtherpaymentsofongoingadviserchargestothatintermediary/adviser.

3) Anadvisedinvestmentwhereadviceisreceivedforanupfrontfeewithnoongoingadvisercharge

Investorswho have invested in theOffer through a financial intermediary/adviser and havereceivedupfrontadviceincludinginvestorswhoareinvestingthroughintermediaries/advisersusingfinancialplatforms.

Whereaninvestoragreedtoanupfrontfeeonly,theCompanycanfacilitateapaymentofaninitialadviserchargeofupto4.5%of the investmentamount. If the investorchoosestopaytheirintermediary/adviserlessthanthemaximuminitialadvisercharge,theremainingamountwillbeused for the issueandallotmentofadditionalOfferShares for the investor, issuedatthemost recently announcedNAVper Share, divided by0.945 as described above. In thesecircumstancestheCompanywillnotfacilitateongoingannualpayments.

In both cases (2) or (3), should the investor choose to pay the adviser more than 2.5% or 4.5%respectively,theexcessamountwillhavetobesettledbytheinvestordirectlywiththeadviser.

4) Anon-advisedinvestmentusinganintermediary

Investors who have invested their money through a financial intermediary and have notreceivedadvice.

An initial commission of 2.5% of the investment will be paid by the Company to theintermediary.Anannualongoingchargeof0.5%oftheinvestmentamount’slatestNAVwillbepaid by the Company to the intermediary. Such commissionwill be available for up to nineyears provided that the intermediary continues to act for the investor and the investorcontinuestobethebeneficialowneroftheOfferShares.

Thesechargesmay,accordingtotheproportionofAdvised Investorswhereadvice is receivedforanupfront fee only, create some limited reduction of the NAV per Share immediately subsequent tosubscriptions in theOfferbeingmade. This effectwill bemitigatedand is ultimately expected tobemorethancompensated,forcontinuinginvestors,bytheexpectedbenefitsderivedfromalargerpoolof investablefundsandthefinancialbenefit insubsequentperiodsoftheabsenceofongoingadviserchargesinrespectofsuchinvestments.

The reinvestment arrangements relating to ongoing adviser charges which are described abovewillonlyoperateforsolongasaninvestorremainstheholderoftheOfferShares.Anypurchaserofthoseshareswillnotbenefit fromthereinvestmentarrangementssetoutaboveirrespectiveoftheadviserchargeswhichtheyhaveagreedwiththeiradviser.ThisthereforemeansthatanypurchaserofOffer

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Shares will not benefit from the issue or allotment of any additional Offer Shares under thearrangementssetoutabove.

AnyadditionalOfferShareswhichareissuedunderthearrangementswhicharedescribedabovewillbeissuedinfullandfinalsatisfactionofanycashsumswhichwouldotherwisebeduetotheinvestor.TheCompanydoesnotherebyacceptorassumeorundertakeanyliabilityorobligationofanynaturewhatsoevertoanyadviserasregardsthepaymentofanyadvisercharges (whethersuchchargesareinitialadviserchargesorongoingadvisercharges).TheroleoftheCompanyissimplytofacilitatesuchpaymentstotheextentpermittedbyapplicablerulesandregulations.

Theabovepaymentsaresubjecttoanyfuturechangesintheapplicablerulesandregulations.

Example

On the assumption that an investor does not receive any advice in respect of their Application, anillustrationofthepricingformulaforanaggregateinvestmentof£10,000undertheOffer(usingthemost recentlypublishedunauditedNAVof theCompanyasat thedateof thisdocument) is setoutbelow:

UnauditedNAVasat

31July2016*(p)

OfferPrice(p)

Application(£)

Numberof

OfferSharestobeallotted

80.5 85.2 £10,000 11,737

*Afterthesubsequentpaymentofadividendof2.5pperShareon26August2016

TheOfferPricemayvarybetweenallotmentsbasedon themovement in thepublishedNAVof theShares.ThecostoftheOfferiscappedat7.5%.OctopushasagreedtoindemnifytheCompanyagainstthecostsoftheOfferinexcessofthisamount.

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ANNEXI

TERMSANDCONDITIONSOFTHEDIVIDENDREINVESTMENTSCHEME(THE“DRIS”)OFTHECOMPANY

1. Elections to participate in the DRIS should be addressed to the DRIS Administrator, Capita AssetServices (“DRIS Administrator”) in accordance with condition 11 and will only be effective fordividendstobepaid15daysfollowingreceiptoftheelectionbytheDRISAdministrator.

2. (a) TheCompany,actingthroughtheDRISAdministrator,shallhaveabsolutediscretiontoacceptorrejectelections.AnapplicantshallbecomeamemberoftheDRISuponacceptanceofhisorherelection by the DRIS Administrator on the Company’s behalf (“Participants”). The DRISAdministrator will provide written notification if an election is rejected. Only registeredshareholdersoftheCompany(“Shareholders”)mayjointheDRIS.

(b) The Company shall apply dividends to be paid to Participants on ordinary shares of 10p each(“Shares”) in theCompany in respect ofwhich an electionhas beenmade in the allotment offurther Shares. TheDRISAdministrator shall nothave thediscretion, andParticipantsmaynotinstruct the DRIS Administrator, to apply those dividends (“funds”) towards any investmentsotherthaninvestmentinSharesassetoutinthiscondition2(b).

(c) ParticipantswhoareShareholdersmayonlyparticipateintheDRISifallSharesregisteredintheirnamearemandatedtotheDRIS.

(d) By joiningtheDRIS,Participants instruct theDRISAdministrator that themandatewillapply tothefullnumberofSharesheldbytheminrespectofwhichtheelectionismade,asenteredontotheshareregisteroftheCompanyfromtimetotime.

(e) InrelationtonewSharestobeallottedinrelationtoadividendsuchShareswillonlybeallottedtotheregisteredshareholderandnotanybeneficialholder. NomineeParticipantsshallnotbeentitledtoinstructtheDRISAdministratortoallotSharestoabeneficialholder(andParticipantsareadvisedtoreadcondition15inrespectoftheconsequencesforVCTTaxreliefs).

3. (a) OnorassoonaspracticableafteradayonwhichadividendontheSharesisduetobepaidtoaParticipantor, if suchday is not adealingdayon the LondonStockExchange, thedealingdaythereafter (“Payment Date”), the Participant’s funds held by the Company shall, subject toconditions9,10and19overleafandtheCompanyhavingtherequisiteshareholderauthoritiestoallotShares,beappliedonbehalfof thatParticipant to subscribe for themaximumnumberofwholenewShareswhichcanbeallottedwiththefunds.

(b) ThenumberofShares tobeallotted toaParticipantpursuant tocondition3(a)aboveshallbecalculated by dividing the Participant’s funds by the greater of (i) the last published net assetvalueperexistingShareor (ii) themidmarketpriceper Shareasquotedon the LondonStockExchangeat thecloseofbusinesson the10thbusinessdaypreceding thedateof issueof suchShares.Shareswillnotbeallottedatlessthantheirnominalvalue.

(c) FractionalentitlementswillnotbeallottedandanyresidualcashbalanceoflessthantheamountrequiredtosubscribeforafurthernewOrdinaryShare,assetoutin3(b)above,willbedonatedtoaregisteredcharityatthediscretionoftheCompany.

(d) The Company shall not be obliged to allot Shares under the DRIS to the extent that the totalnumber of Shares allotted by the Company pursuant to the DRIS in any financial year wouldexceed10%oftheaggregatenumberofSharesonthefirstdayofsuchfinancialyear.

(e) TheCompanyshallimmediatelyafterthesubscriptionofSharesinaccordancewiththeconditionat3(a)abovetakeallnecessarystepstoensurethatthoseSharesshallbeadmittedtotheOfficial

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ListandtotradingonthepremiumsegmentofthemainmarketoftheLondonStockExchange,providedthat,atthetimeofsuchsubscription,theexistingSharesinissuearesoadmittedtotheOfficial List and to trading on the premium segment of themainmarket of the London StockExchange.

4. TheDRISAdministratorshallassoonaspracticableaftertheallotmentofShares inaccordancewithcondition3procure (i) that theParticipantsareenteredontotheShareRegisterof theCompanyasthe registered holders of those Shares (ii) that share certificates (unless such Shares are to beuncertified)and,whereapplicable, incometaxvouchers(“TaxVouchers”)aresenttoParticipantsattheirownriskand(iii)thatParticipantsreceiveastatementdetailing:

(a) thetotalnumberofSharesheldattherecorddateforwhichavalidelectionwasmade;

(b) thenumberofSharesallotted;

(c) thepriceperShareallotted;

(d) thecashequivalentoftheSharesallotted;and

(e) thedateofallotmentoftheShares.

5. AllcostsandexpensesincurredbytheDRISAdministratorinadministeringtheDRISwillbebornebytheCompany.

6. Each Participant warrants to the DRIS Administrator that all information set out in the applicationformonwhichtheelectiontoparticipateintheDRISiscontainediscorrectandtotheextentanyoftheinformationchangesheorshewillnotifythechangestotheDRISAdministratorandthatduringthe continuanceofhisorherparticipation in theDRISheor shewill complywith theprovisionsofcondition7below.

7. The right toparticipate in theDRISwill notbeavailable to anypersonwho is a citizen, residentornationalof,orwhohasaregisteredaddressin,anyjurisdictionoutsidetheUKunlesssuchrightcouldproperlybemadeavailabletosuchperson.NosuchpersonreceivingacopyoftheDRISdocumentsmaytreatthemasofferingsucharightunlessanoffercouldproperlybemadetosuchperson.It isthe responsibilityofanyShareholderwishing toparticipate in theDRIS tobe satisfiedas to the fullobservanceofthelawsoftherelevantjurisdiction(s)inconnectiontherewith,includingobtaininganygovernmentalorotherconsentswhichmayberequiredandobservinganyotherformalitiesneedingtobeobservedinanysuchjurisdiction(s).

8. Participants acknowledge that theDRIS Administrator is not providing a discretionarymanagementservice.NeithertheDRISAdministratornortheCompanyshallberesponsibleforanylossordamageto Participants as a result of their participation in the DRIS unless due to the negligence or wilfuldefaultoftheDRISAdministratorortheCompanyortheirrespectiveemployeesandagents.

9. Participantsmay:

(a) at any time by notice to the DRIS Administrator terminate their participation in the DRIS andwithdrawanyfundsheldbytheCompanyontheirbehalf;and

(b) inrespectofSharestheyholdasnomineeandsubjecttocondition2(e),givenoticetotheDRISAdministratorthat,inrespectofaforthcomingPaymentDate,theirelectiontoreceiveSharesisonlytoapplytoaspecifiedamountduetotheParticipantassetoutinsuchnotice.

Such notices shall not be effective in respect of the next forthcoming Payment Date unless it isreceivedbytheDRISAdministratoratleast15dayspriortosuchPaymentDate.Inrespectofnoticesunder(a)above,suchnoticewillbedeemedtohavebeenservedwheretheParticipantceasestoholdanyShares.Uponreceiptofnoticeoftermination,allfundsheldbytheCompanyontheParticipant’sbehalf shallbe returned to theParticipantas soonas reasonablypractical at theaddress setout in

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registerofmembers,subjecttoanydeductionswhichtheCompanymaybeentitledorboundtomakehereunder.

10. TheCompanyshallbeentitledatitsabsolutediscretion,atanytimeandfromtimetotimeto:

(a) suspendtheoperationoftheDRIS;

(b) terminatetheDRISwithoutnoticetotheParticipants;and/or

(c) resolvetopaydividendstoParticipantspartlybywayofcashandpartlybywayofnewSharespursuanttotheDRIS.

11. Participantswhowishtoparticipate intheDRIS inrespectofnewSharestobeissuedpursuanttoaprospectusortop-upofferdocumentmayticktherelevantboxontheapplicableapplicationform.

ParticipantswhowishtoparticipateintheDRISandwhoalreadyhaveSharesissuedtothemheldincertificatedform,i.e.notinCREST,shouldcompleteandsignaMandateFormandreturnitnolaterthan15dayspriortothedividendpaymentdatetoCapitaAssetServices,TheRegistry,34BeckenhamRoad,Beckenham,KentBR34TU. PersonalisedMandate Forms canbeobtained fromCapitaAssetServices at the address above or by telephoning +44 (0) 371 664 0324. Calls are charged at thestandardgeographicrateandwillvarybyprovider.CallsoutsidetheUnitedKingdomwillbechargedattheapplicableinternationalrate.CapitaAssetServicesareopenbetween9am–5.30pm,MondaytoFridayexcludingpublicholidaysinEnglandandWales.

ParticipantswhowishtoparticipateintheDRISandwhoalreadyhaveSharesissuedtothemheldinuncertificatedforminCREST(andwereinuncertificatedformasattherelevantrecorddate),canonlyelecttoreceiveadividendintheformofnewSharesbymeansoftheCRESTproceduretoeffectsuchanelection. NoothermethodofelectionwillbepermittedundertheDRISandwillberejected. Bydoingso,suchShareholdersconfirmtheirelectiontoparticipateintheDRISandtheiracceptanceoftheDRIS terms and conditions. If a Participant is a CREST sponsoredmember, they should consulttheirCRESTsponsor,whowillbeabletotakeappropriateactionontheirbehalf. AllelectionsmadeviatheCRESTsystemshouldbesubmittedusingtheDividendElection InputMessage inaccordancewiththeproceduresasstatedintheCRESTReferenceManual.TheDividendElectionInputMessagesubmittedmustcontain thenumberofSharesonwhich theelection isbeingmade. If the relevantfield is left blank or completed with zero, the election will be rejected. If a Participant enters anumber of Shares greater than the holder in CREST on the relevant record date for dividend thesystemwillautomaticallyamendthenumberdowntotherecorddateholding. When inputtingtheelection, a ‘singledrip’ election shouldbe selected (theCorporationActionNumber for this canbefoundontheCRESTGUI).Evergreenelectionswillnotbepermitted.ParticipantswhowishtoreceivenewShares insteadofcash inrespectof futuredividends,mustcompleteaDividendElectionInputMessageoneachoccasionotherwisetheywillreceivethedividendincash.ElectionsviaCRESTshouldbereceivedbyCRESTnolaterthan5.00pmonsuchdatethatisatleast15daysbeforethedividendpaymentdate for therelevantdividend inrespectofwhichyouwishtomakeanelection. OnceanelectionismadeusingtheCRESTDividendElectionInputMessageitcannotbeamended.Therefore,if a CREST Shareholder wishes to change their election, the previous election would have to becancelled.

12. AwrittenmandateformwillremainvalidforalldividendspaidtotheParticipantbytheCompanyuntilsuchtimeastheParticipantgivesnoticeinwritingtoCapitaAssetServicesthathenolongerwishestoparticipateintheDRIS.

13. TheCompanyshallbeentitledtoamendtheDRISTermsandConditionsongivingonemonth’snoticeinwritingtoallParticipants.Ifsuchamendmentshavearisenasaresultofanychangeinstatutoryorotherregulatoryrequirements,noticeofsuchamendmentwillnotbegiventoParticipantsunless intheCompany’sopinionthechangemateriallyaffectstheinterestsoftheParticipants.AmendmentstotheDRISTermsandConditionswhichareofaformal,minorortechnicalnatureormadetocorrectamanifesterrorandwhichdonotadverselyaffecttheinterestsofParticipantsmaybeeffectedwithoutnotice.

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14. By ticking the relevant election box and completing and delivering the application form, theParticipant:

(a) agrees toprovide theCompanywithany informationwhich itmay request in connectionwithsuchapplicationandtocomplywithlegislationrelatingtoventurecapitaltrustsorotherrelevantlegislation(asthesamemaybeamendedfromtimetotime);and

(b) declaresthataloanhasnotbeenmadetotheParticipantonwhosebehalftheSharesareheldoranyassociateofeitherofthem,whichwouldnothavebeenmadeornothavebeenmadeonthesametermsbutfortheParticipantelectingtoreceivenewSharesandthattheSharesarebeingacquiredforbonafideinvestmentpurposesandnotaspartofaDRISorarrangementthemainpurposesofwhichistheavoidanceoftax.

15. Elections by individuals for Shares should attract applicable VCT tax reliefs (depending on theparticularcircumstancesofan individual) forthetaxyear inwhichtheSharesareallottedprovidedthattheissueofSharesundertheDRIS iswithintheinvestor’sannual£200,000limit. Participantsandbeneficialownersareresponsibleforascertainingtheirowntaxstatusandliabilitiesandneitherthe DRIS Administrator nor the Company accepts any liability in the event that tax reliefs are notobtained.Beneficialownersofsharesheldthroughnomineesshouldobtaintaxadvice inrelationtotheirownparticularcircumstances. TheTaxVouchercanbeused toclaimany relevant incometaxrelief either by obtaining from the HM Revenue& Customs an adjustment to the Participant’s taxcodingunderthePAYEsystemorbywaitinguntiltheendoftheyearandusingtheSelfAssessmentTaxReturn.

16. The Company will subject to conditions 9, 10 and 19, issue Shares in respect of the whole of anydividend payable (for the avoidance of doubt irrespective of whether the amount of allotment isgreaterthananymaximumlimitsimposedfromtimetotimetobeabletobenefitfromanyapplicableVCTtaxreliefs)unlesstheDRISAdministratorhasbeennotifiedtothecontraryinwritingatleast15daysbeforeaPaymentDate.

17. ShareholderselectingtoreceiveSharesratherthanacashdividendwillbetreatedashavingreceivedanormaldividend. ShareholdersqualifyingforVCTtaxreliefsshouldnotbe liableto incometaxonsharesallottedinrespectofdividendsfromqualifyingVCTshares.

18. Forcapitalgainstaxpurposes,ShareholderswhoelecttoreceiveSharesinsteadofacashdividendarenottreatedashavingmadeacapitaldisposaloftheirexistingShares.ThenewShareswillbetreatedasaseparateassetforcapitalgainspurposes.

19. TheCompanyshallnotbeobligedtoacceptanyapplicationorissueShareshereunderiftheDirectorssodecideintheirabsolutediscretion.TheCompanymaydoorrefrainfromdoinganythingwhich,inthereasonableopinionoftheDirectors,isnecessarytocomplywiththelawofanyjurisdictionoranyrules, regulationsor requirementsofany regulatoryauthorityorotherbody,which isbindingupontheCompanyortheDRISAdministrator.

20. TheamountofanyclaimorclaimsaParticipanthasagainsttheCompanyortheDRISAdministratorshallnotexceedthevalueofsuchParticipant’sSharesintheDRIS.NothingintheseDRISTermsandConditions shall exclude theCompanyor theDRISAdministrator fromany liability causedby fraud,wilfuldefaultornegligence.NeithertheCompanynortheDRISAdministratorwillberesponsiblefor:

(a) actingorfailingtoactinaccordancewithacourtorderofwhichtheDRISAdministratorhasnotbeennotified(whateverjurisdictionmaygovernthecourtorder);or

(b) forged or fraudulent instructions and will be entitled to assume that instructions receivedpurportingtobefromanShareholder(or,whererelevant,anominee)aregenuine;or

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(c) losses,costs,damagesorexpensessustainedorincurredbyanShareholder(or,whererelevant,anominee)byreasonofindustrialactionoranycausebeyondthecontroloftheCompanyortheDRIS Administrator, including (without limitation) any failure, interruption or delay inperformanceoftheobligationspursuanttotheseDRISTermsandConditionsresultingfromthebreakdown,failureormalfunctionofanytelecommunicationsorcomputerserviceorelectronicpaymentsystemorCREST;or

(d) anyindirectorconsequentialloss.

21. TheseDRIS Terms andConditions are for thebenefit of a Participant only and shall not confer anybenefitson,orbeenforceableby,athirdpartyandtherightsand/orbenefitsathirdpartymayhavepursuanttotheContracts(RightsofThirdParties)Act1999areexcludedtothefullestpossibleextent.

22. AllnoticesandinstructionstobegiventotheDRISAdministratorshallbeinwritinganddeliveredorpostedtoCapitaAssetServices,TheRegistry,34BeckenhamRoad,Beckenham,KentBR34TU.

23. TheseDRISTermsandConditionsshallbegovernedby,andconstruedinaccordancewith,Englishlawand each Participant submits to the jurisdiction of the English courts and agrees that nothing shalllimittherightoftheCompanytobringanyaction,suitorproceedingarisingoutoforinconnectionwiththeDRISinanyothermannerpermittedbylaworinanycourtofcompetentjurisdiction.

Shareholderswhoareinanydoubtabouttheirtaxpositionshouldconsulttheirindependentfinancialadviser.

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ANNEXII

OCTOPUSAPOLLOVCTPLC

DIVIDENDREINVESTMENTSCHEMEMANDATEFORM

If you wish to participate in the dividend reinvestment scheme (the “Scheme”) in respect of yourholdingofSharesinOctopusApolloVCTplc,pleasesignandreturnthisformto,CapitaAssetServices(“Capita”or “theSchemeAdministrator”), TheRegistry,34BeckenhamRoad,Beckenham,KentBR34TUnolaterthan15BusinessDaysbeforethepaymentofadividendbytheCompany.Allenquiriesconcerning this form should be made to Capita Asset Services, New Issues, The Registry, 34Beckenham Road, Beckenham, Kent BR3 4TU or by telephoning +44 (0) 371 664 0324. Calls arechargedatthestandardgeographicrateandwillvarybyprovider.CallsoutsidetheUnitedKingdomwillbechargedattheapplicable internationalrate. CapitaAssetServicesareopenbetween9am–5.30pm,MondaytoFridayexcludingpublicholidaysinEnglandandWales.If your Shares are held in more than one account you must complete a separate form for eachaccount.YoumayobtainfurthercopiesofthisformfromtheSchemeAdministrator.If youdecide toparticipate in the Schemeyouwill bedeemed tohaveagreed that anymandatewhichyouhavegiven for thepaymentofcashdividendsdirectly toyourBankorBuildingSocietyaccountshallbesuspendedforsolongasyouremainaparticipantintheScheme.Shareholders in any doubt about the tax position should consult their independent professionaladviser.Inthecaseofjointholdersallholdersmustsign.Inthecaseofacorporation/nomineecompanythisform must be executed under its common seal or be signed by a duly authorised official, whosecapacityshouldbestatedinaccordancewithSection44oftheCompaniesAct2006.IfthisformisnotcompletedtothesatisfactionoftheDRISAdministratoritwillnotbeprocessedandwillbereturnedtoyouforcompletion.YoucanalsoregistertoreinvestdividendsinOctopusApolloVCTplcbycallingOctopuson08003162295whowillbehappytosendyouanApplicationForm,bywritingtorequestacopyfromOctopusInvestments Limited, 33 Holborn, London, EC1N 2HT or by visiting the Investor/Document LibrarysectionoftheOctopuswebsiteat:www.octopusinvestments.comYouwillneedtosendyourdividendreinvestmentinstructionstoCapitaat least15dayspriortothedividendpaymentdatetobeabletoparticipateandreinvestyourdividendonthedividendpaymentdate.You can revoke a dividend reinvestment election inOctopusApollo VCT plc by contacting theDRISAdministrator.

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To:theDRISAdministratorandtheCompanyI/We,theundersigned,confirmthatI/wehavereadandunderstoodthetermsandconditionsoftheDRIS and that I/wewish to participate in that DRIS for each future dividend paid on the Shares ofOctopusApolloVCTplcindicatedbelowandtowhichtheschemeisapplied.I/WeagreethatfuturedividendspaidonShareswillbereinvestedinShares.TickHeretoreinvestOctopusApolloVCTplc

Shareholder Name(1)

Shareholder Name(2)

Shareholder Name(3)

Shareholder Name(4)

Address:

Allshareholdersnamedabovemustsignhere.Signature(1)

Date

Signature(2)

Date

Signature(3)

Date

Signature(4)

Date

Daytimetelephonenumber

NationalInsurancenumberorInvestorCodenumber(whichcanbefoundonyoursharecertificate)

Emailaddress

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ListofAdviserstotheCompanyInvestmentManagerandAdministratorandReceivingAgents

OctopusInvestmentsLimited33HolbornLondonEC1N2HT

CompanySecretary NicolaBoardACIS

Auditor GrantThorntonUKLLP3140RowanPlaceJohnSmithDriveOxfordBusinessParkSouthOxfordOX42WB

Solicitor HowardKennedyLLP1LondonBridgeLondonSE19BG

Sponsor HowardKennedyCorporateServicesLLP1LondonBridgeLondonSE19BG

Taxadviser PhilipHare&AssociatesLLPSuiteCFirstFloor4-6StapleInnLondonWC1V7QH

Registrars CapitaAssetServicesTheRegistry34BeckenhamRoadBeckenhamKentBR34TU

ReportingAccountant Scott-MoncrieffExchangePlace3SempleStreetEdinburghEH38BL

VCTstatusmonitor PricewaterhouseCoopers1EmbankmentPlaceLondonWC2N6RH

III:4.11

0800 316 2295clientrelations@octopusinvestments.comoctopusinvestments.com

Octopus Investments, 33 Holborn,London EC1N 2HT

Octopus Apollo VCT

Octopus Apollo VCT application form

Octopus Apollo VCT

How to complete this application formPlease make sure you answer all the questions marked with an ‘*’.Leave boxes blank where they don’t apply to you.Please remember to send us your payment.Once completed please send to:

Octopus Investments Limited PO Box 10847 Chelmsford CM99 2BU

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Octopus Apollo VCT plc • Application Form • Questions? 0800 316 2295Page 2 of 8

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6-16

09Before completing this Offer Application Form, you should read the prospectus dated 4 November 2016, which includes the Terms and Conditions of the Offer. The Offer will close at 12 noon on 3 November 2017 unless closed earlier.

Please note that HM Revenue & Customs (HMRC) places restrictions on buying and selling VCT shares in the same VCT within a six-month period. This means that if you have sold, or will sell, existing shares in Octopus Apollo VCT or Octopus Eclipse VCT within the six months before or after this investment, you will not be able to claim any upfront tax relief.

Section 1 – About the investor* Title

(Mr/Mrs/Miss/Ms/Other)

* First name(s)

* Last name

* Are you an existing Octopus client? Yes No

* Country of birth

* Country(ies) of citizenship

* Date of birthDD MM YYYY

* National Insurance number

* Telephone numbers Country code Telephone number

Primary:

Secondary:

* Email address

* Address line 1

Address line 2

* Town/City

County

* Country

* Postcode * Information from

Octopus Octopus may occasionally send you information that we believe to be of interest to you, e.g. newsletters. If you would not like to receive such information, please tick the box.

The printing and postage costs of sending out the Octopus Apollo VCT annual and interim reports are paid for by the VCT itself. Therefore, to reduce waste and help to cut costs, we will default to sending these to you electronically via the email address provided above. Please tick the box if you would prefer to receive these by post. You can update your preference at any time by calling us on 0800 316 2295.

Octopus Apollo VCT plc • Application Form • Questions? 0800 316 2295 Page 3 of 8

Section 2 – About the investment* How much are

you investing?You can choose to invest in the current tax year (2016/17), the next tax year (2017/18), or both. Please indicate the amount(s) in the relevant box(es). The minimum investment is £5,000 and the maximum investment still qualifying for tax relief is £200,000 in each of these tax years.

2016/17 £ 2017/18 £

If your investment is for the following tax year, we will hold your investment in cash until that time.

* Payment Options Cheque/banker’s draftPlease enclose a cheque from your personal account, made payable to ‘Octopus Apollo VCT – Applications’. We do not accept cheques from business accounts, third parties (including your spouse) or post-dated cheques. Banker’s drafts and building society cheques must specifically mention the investor’s name.

Bank transfer Please transfer your funds to the following account after first sending in your completed application form, making sure that you reference the payment with your surname and initials:

Account name: Octopus Apollo VCT – ApplicationsSort code: 40-03-28 Bank: HSBCAccount number: 82721546 Branch: Holborn

Payments need to come from your personal account. (We do not accept payments from business accounts or third parties, including your spouse.)

Section 3 – Dividend reinvestment or payment* Dividend reinvestment

or payment? Any dividends paid by the VCT can be reinvested in additional VCT shares, or received as cash payments into your bank account. Please select your preferred option. If you select the dividend payment option, please complete the bank details section as well.

(You must select one of the two options)

Reinvest dividends

By completing this section, you confirm that you’ve read and understood the Terms and Conditions of the Dividend Reinvestment Scheme as set out in Annex 1 of the prospectus or in the circular.

Please note that reinvesting dividends counts towards your £200,000 annual VCT allowance – the amount on which you can claim tax relief each year.

Pay out dividends

Please provide details of the bank account you would like future dividends to be paid into (bank account must be in your name).Sort code

Account number

Account holder name

If you are an existing Octopus Apollo VCT or Octopus Eclipse VCT shareholder, your instruction to reinvest or pay out dividends here overrides any previous dividend instructions you have given us on your existing Octopus Apollo or Eclipse VCT investments.

If you are a direct investor, please go straight to Section 5.1.

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Octopus Apollo VCT plc • Application Form • Questions? 0800 316 2295Page 4 of 8

Section 4 – Adviser/intermediary details (to be completed by your adviser/intermediary)

Company

Title (Mr/Mrs/Miss/Ms/Other)

First name(s)

Last name

Telephone

* Email address

* Address line 1

Address line 2

* Town/City

County

* Country

* Postcode

FCA number Are you part of a

network/service provider? No Yes – please give us the network/service provider name

Section 5 – Adviser/intermediary payment

* What type of investment is this?

(Complete one section only)

All Octopus fees and charges are outlined in both the prospectus and the brochure. The VCT can also facilitate payments to your financial adviser/intermediary. Please complete either section 5.1, 5.2, 5.3 or 5.4. Failure to complete this section correctly could result in delays to your investment. If you have any questions please call us on 0800 316 2295.

5.1 This is a direct investment with no adviser or intermediary involved Please go straight to Section 6 – Tax Residency Status.

5.2 This is an advised investment with an initial adviser charge and/or an ongoing adviser chargePlease indicate the level of initial charges and/or ongoing charges you have agreed with your adviser. If you have agreed with your adviser that you are not paying the maximum available adviser charge, the remaining amount will be rebated to you as additional shares as outlined in the prospectus.

To my adviser

Initial: % (maximum available charge of 2.5%)

Ongoing: % (maximum available charge of 0.5%)

5.3 This is an advised investment with an initial adviser charge and no ongoing adviser chargePlease indicate the level of initial adviser charge you have agreed with your adviser. If you have agreed with your adviser that you are not paying the maximum available adviser charge, the remaining amount will be rebated to you as additional shares as outlined in the prospectus.

To my adviser

Initial: % (maximum available charge of 4.5%)

5.4 This is a non-advised investment through an intermediary and you have not received financial advice

Initial Commission % Ongoing Commission % Standard terms will apply if left blank. Commission should not exceed our standard terms (given in the Octopus Apollo VCT prospectus and brochure), otherwise this form may be rejected. If your execution-only intermediary chooses not to take any upfront commission, this amount will instead be used to buy additional VCT shares for you.

Special instructions

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Octopus Apollo VCT plc • Application Form • Questions? 0800 316 2295 Page 5 of 8

Section 6 – Tax residency status* 6.1 We are legally required to collect information about the tax residency and classifications of each investor

which may be shared with HM Revenue & Customs. For further information, please visit octopusinvestments.com/reportingforms.Are you tax resident, or do you complete tax returns, in any country other than the UK?

No – please go straight to Section 7. Yes – please complete the table below.

6.2 Please list the country(ies), other than the UK, in which you are resident for tax purposes. Please provide the Taxpayer Identification Number (TIN) or functional equivalent for each country(ies), or tick the relevant box if the country does not provide a TIN.

Country(ies) Taxpayer Identification Number (TIN) TIN not available

Section 7 – Investor declarationBy signing this form, I HEREBY DECLARE THAT:1. My decision to invest has been made on the basis of the information contained in the Octopus Apollo VCT

prospectus. 2. I have provided accurate information, to the best of my knowledge.3. I consent to Octopus facilitating my adviser’s fees and charges as set out in Section 5.

* Investor name

* Investor signature

* Date signedDD MM YYYY

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Octopus Apollo VCT plc • Application Form • Questions? 0800 316 2295Page 6 of 8

What happens next?We’ll let you know when we’ve received your funds and application form and if we need any further information from you.

After that, we will allot your VCT shares at the next available date. These dates are usually listed on our website. This process can take several months, but we always aim for shares to be allotted in the same tax year as the application was made.

We’ll write to let you know when your shares have been allotted and enclose your share and income tax certificates.

After that, as a shareholder, you’ll receive annual and half-yearly reports containing the full financial statements for your VCT: these include updates from the Chairman and Octopus, the fund manager.

Before sending us your application, please review the quick checklist below to help us process your application as quickly as possible:

You have arranged for a payment as per Section 2.

You’ve signed and dated where indicated in Section 7.

Once complete please send your completed application form to:

Octopus Investments Limited PO Box 10847 Chelmsford CM99 2BU

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Octopus Apollo VCT plc • Application Form • Questions? 0800 316 2295Page 8 of 8

Got a question?

We don’t offer financial or tax advice, which is why we always recommend talking to a qualified financial adviser before making any investment decisions. However, if you have any other questions about Octopus Apollo VCT, please call us on 0800 316 2295. We’re always happy to hear from you.

CAM04286-1609 Octopus Investments Limited is authorised and regulated by the Financial Conduct Authority

Octopus Investments, 33 Holborn,London EC1N 2HT

0800 316 2295clientrelations@octopusinvestments.comoctopusinvestments.com

Octopus Apollo VCT