Amendment to Custodian Capital Limited IMA

22 June 2020

Mattioli Woods plc

("Mattioli Woods", "the Company" or "the Group")

Amendment to Custodian Capital Limited Investment Management Agreement

Mattioli Woods plc (AIM: MTW.L), the specialist wealth management and employee benefits business, announces that the terms of the Investment Management Agreement ("IMA") between its subsidiary, Custodian Capital Limited ("CCL"), and Custodian REIT plc ("Custodian REIT") have been amended following expiry of the IMA's three year term. 

In light of the performance of CCL, the Board of Custodian REIT has agreed a further three year term with 12 months' subsequent notice to CCL's ongoing engagement as external discretionary fund manager from 1 June 2020.  Fees payable to CCL under the IMA have been amended to include:

·     A step down in the annual management charge from 0.65% to 0.55% of net asset value ("NAV") applied to NAV in excess of £750 million; and

·     A step down in the administrative fee from 0.05% to 0.03% of NAV applied to NAV in excess of £750 million.

Key Investment Manager personnel set out in the IMA now comprise Richard Shepherd-Cross (Managing Director), Ed Moore (Finance Director), Alex Nix (Assistant Fund Manager) and Tom Donnachie (Property Manager), with Nathan Imlach (Chief Financial Officer of Mattioli Woods) having stepped down and been replaced as Company Secretary by Ed Moore.

All other key terms of the IMA remain unchanged.

The Board considers these amendments to the IMA to be in the best interests of the Company's shareholders for the following reasons:

·     Another three year term provides CCL with security of tenure and allows further investment in the dedicated systems and people providing its services under the IMA;

·     Fee changes will be beneficial to clients of the Company who are investors in Custodian REIT, particularly where NAV exceeds £750 million, by reducing Custodian REIT's ongoing charges ratio and increasing its dividend capacity; and

·     The Board of Custodian REIT acknowledges the demands which an increased Corporate Governance regime, including environmental, social and governance ("ESG") reporting, is placing on CCL.

Ian Mattioli, Chief Executive of the Company and Non-Executive Director of Custodian REIT, commented:

"The Board of Custodian REIT has been pleased with the performance of CCL as Investment Manager, particularly the timely deployment of new monies on high quality assets, and is confident that CCL will successfully navigate the fund through the current market uncertainty caused by the COVID-19 pandemic.  The revised IMA terms will secure both further cost reductions for our clients and other investors in Custodian REIT with NAV growth and an important long-term revenue stream for the Group."

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