Other information

Principles

A.
A successful company is led by an effective board, whose role is to promote the long-term sustainable success of the company, generating value for shareholders and contributing to wider society. The board should ensure that the necessary resources, policies and practices are in place for the company to meet its objectives and measure performance against them. (Incorporates relevant content from UK Code Principle A)

B.
The board should establish the company’s purpose, values and strategy, and satisfy itself that these and its culture are all aligned. All directors must act with integrity, lead by example and promote the desired culture. (UK Code Principle B)

C.
Governance reporting should focus on board decisions and their outcomes in the context of the company’s strategy and objectives. Where the board reports on departures from the AIC Code’s provisions, it should provide a clear explanation.  (UK Code Principle C)

D.
In order for the company to meet its responsibilities to shareholders and stakeholders, the board should ensure effective engagement with, and encourage participation from, these parties. (UK Code Principle D)

Provisions

1.
The board should assess the basis on which the company generates and preserves value over the long-term. It should describe in the annual report how opportunities and risks to the future success of the business have been considered and addressed, the sustainability of the company’s business model and how its governance contributes to the delivery of its strategy. For an investment company, the annual report should also include the company’s investment objective and investment policy. (Incorporates relevant content from UK Code Provision 1)

Tetragon Compliance Statement

Tetragon’s investment objective is to generate distributable income and capital appreciation. Tetragon’s investment strategy to achieve that investment objective is stated in its Annual Report and on Tetragon’s website (under the heading Investment Strategy).

The Board of Directors does not hold separate strategy meetings, but overall strategy is discussed in detail at quarterly meetings of the Board of Directors and at ad hoc board meetings when required. Directors also have the opportunity to discuss these and any other matters with the investment manager outside of meetings of the Board of Directors as appropriate.

The investment manager provides a detailed investment report to the Board of Directors at quarterly board meetings across all key investment matrices including performance and allocation. The investment manager also provides a risk management update to the Board of Directors at quarterly meetings. Industry issues are raised and discussed.

2.
The board should assess and monitor its own culture, including its policies, practices and behaviour to ensure it is aligned with the company’s purpose, values and strategy. It should also assess how its desired culture has been embedded. (Incorporates relevant content from UK Code Provision 2)

Tetragon Compliance Statement

The Board of Directors is made up of a broad range of professionally qualified or industry experienced personnel with relevant and suitable academic and professional backgrounds including a majority being Independent Directors. The Board of Directors believes this is an appropriate balance of skills, experience and knowledge that is relevant to Tetragon’s activities. The Board of Directors assesses how the culture desired for Tetragon has been embedded.

3.
In addition to formal general meetings, the chair should seek regular engagement with major shareholders in order to understand their views on governance and performance against the company’s investment objective and investment policy. Committee chairs should seek engagement with shareholders on significant matters related to their areas of responsibility. The chair should ensure that the board has a clear understanding of the views of shareholders. (Incorporates relevant content from UK Code Provision 3)

Tetragon Compliance Statement

The investment manager has been delegated responsibility for monitoring the shareholder profile of Tetragon and has in place a system for canvassing shareholder views and communicating views to the shareholders. The investment manager holds regular investor calls and an annual investor day. The investment manager provides the Board of Directors with comprehensive shareholder reports and corporate broker updates and analysis at meetings of the Board of Directors.

All major corporate communications are reviewed and approved by the Board of Directors.

4.
When 20 per cent or more of votes have been cast against the board recommendation for a resolution, the company should explain, when announcing voting results, what actions it intends to take to consult shareholders in order to understand the reasons behind the result. An update on the views received from shareholders and actions taken should be published no later than six months after the shareholder meeting. The board should then provide a final summary in the annual report and, if applicable, in the explanatory notes to resolutions at the next shareholder meeting, on what impact the feedback has had on the decisions the board has taken and any actions or resolutions now proposed. (UK Code Provision 4)

Tetragon Compliance Statement

Tetragon has 10 voting shares in issue, which were issued at par and are owned by Polygon Credit Holdings II Limited (the Voting Shareholder). The Voting Shareholder is a non-U.S. affiliate of Tetragon’s investment manager.

Tetragon’s voting shares are the only shares of Tetragon entitled to vote for the election of Tetragon’s board of directors and on all other matters, subject to the limited rights of the ordinary shares as described in Tetragon’s Memorandum and Articles of Incorporation.

Should the Voting Shareholder vote against a resolution proposed by the Board of Directors, the Board of Directors would engage with the Voting Shareholder to understand any concerns it may have.

5.
The board should understand the views of the company’s other key stakeholders and describe in the annual report how these and the matters set out in section 172 of the United Kingdom’s Companies Act 2006 have been considered in board discussions and decision-making. The board should keep engagement mechanisms under review so that they remain effective. (Incorporates relevant content from UK Code Provision 5)

Tetragon Compliance Statement

The Board of Directors have considered the matters set out in section 172 of the United Kingdom’s Companies Act 2006 insofar as Guernsey law requires consideration of the same. Tetragon has delegated the monitoring of and engagement with Tetragon’s key stakeholders to the investment manager. The investment manager engages regularly with key stakeholders by means of investor calls and on annual investor day. The investment manager provides comprehensive reports and updates on these matters at meetings of the Board of Directors.

6.
The board should take action to identify and manage conflicts of interest, including those resulting from significant shareholdings, and ensure that the influence of third parties does not compromise or override independent judgement. (UK Code Provision 7)

Tetragon Compliance Statement

Tetragon’s Articles of Incorporation require the members of the Board of Directors to disclose any conflicts of interest that they may have in relation to the company or a transaction upon becoming aware of such a conflict of interest. A member of the Board of Directors is not entitled to vote on a matter relating to a transaction, attend the relevant Board of Directors meeting, count in the quorum for any such meeting, sign any transactional document on behalf of Tetragon and do any other thing in his capacity as a director in relation to a transaction that they may be interested unless they have disclosed the nature and extent of their interest.

7.
Where directors have concerns about the operation of the board or the company that cannot be resolved, their concerns should be recorded in the board minutes. On resignation, a non-executive director should provide a written statement to the chair, for circulation to the board, if they have any such concerns. (Incorporates relevant content from UK Code Provision 8)

Tetragon’s Compliance Statement

The minutes of meetings of the Board of Directors of Tetragon record a summary of any concerns raised by members of the Board of Directors about the operation of the Board of Directors that cannot be resolved. To date, no written statement of concern has been provided by any retiring member of the Board of Directors.

Principles

F.
The chair leads the board and is responsible for its overall effectiveness in directing the company. They should demonstrate objective judgement throughout their tenure and promote a culture of openness and debate. In addition, the chair facilitates constructive board relations and the effective contribution of all non-executive directors, and ensures that directors receive accurate, timely and clear information. (UK Code Principle F)

G.
The board should consist of an appropriate combination of directors (and, in particular, independent non-executive directors) such that no one individual or small group of individuals dominates the board’s decision making. (Incorporates relevant content from UK Code Principle G)

H.
Non-executive directors should have sufficient time to meet their board responsibilities. They should provide constructive challenge, strategic guidance, offer specialist advice and hold third party service providers to account. (Incorporates relevant content from UK Code Principle H)

I.
The board, supported by the company secretary, should ensure that it has the policies, processes, information, time and resources it needs in order to function effectively and efficiently. (UK Code Principle I)

Provisions

8.
The responsibilities of the chair, senior independent director, board and committees should be clear, set out in writing, agreed by the board and made publicly available. The annual report should set out the number of meetings of the board and its committees, and the individual attendance by directors. (Incorporates relevant content from UK Code Provision 14)

Tetragon’s Compliance Statement

The responsibilities of the members of the Board of Directors and Audit Committee are set out in the Corporate Governance section of the Tetragon website. Details of the number of meetings of the Board of Directors and Audit Committee is set out in Tetragon’s Compliance Statement for Provision 1. Tetragon has not appointed a senior independent director (see Provision 14 for additional information).

9.
When making new appointments, the board should take into account other demands on directors’ time. Prior to appointment, significant commitments should be disclosed with an indication of the time involved. Additional external appointments should not be undertaken without prior approval of the board, with the reasons for permitting significant appointments explained in the annual report. (Incorporates relevant content from UK Code Provision 15)

Tetragon’s Compliance Statement

Each Director is appointed annually by the Voting Shareholder in accordance with the process disclosed on Tetragon’s website and in its Annual Report.

10.
At least half the board, excluding the chair, should be non-executive directors whom the board considers to be independent. The majority of the board should be independent of the manager. There should be a clear division of responsibilities between the board and the manager. (Incorporates relevant content from UK Code Provision 11)

Tetragon’s Compliance Statement

Tetragon’s Articles of Incorporation require not less than a majority of the Directors to be Independent Directors. Currently more than a majority of the Board of Directors (three out of five) are Independent Directors. A member of the Board of Directors will be an “Independent Director” if the Board of Directors determines that the person satisfies the standards for independence contained in the UK Code in all material respects. The Board of Directors has undertaken an evaluation of the independence of each of the three Independent Directors.

The Board of Directors has delegated to the investment manager certain functions, including broad discretion to adopt an investment strategy and key operational issues. However, certain matters are specifically reserved for the Board of Directors under Tetragon’s Articles of Incorporation.

11.
The chair should be independent on appointment when assessed against the circumstances set out in Provision 13. (Incorporates relevant content from UK Code Provision 9)

Tetragon’s Compliance Statement

Tetragon has not appointed a permanent Chairman, but a chairman is elected for each meeting of the Board of Directors. An experienced Independent Director typically performs the role of chairman. All Directors have the opportunity to declare conflicts of interest at each meeting of the Board of Directors; such conflicts or potential conflicts are recorded in the relevant board minutes.

12.
On appointment, and throughout the chair’s tenure, the chair should have no relationships that may create a conflict of interest between the chair’s interest and those of shareholders, including:

being an employee of the manager or an ex-employee who has left the employment of the manager within the last five years;
being a professional adviser who has provided services to the manager or the board within the last three years; or
serving on any other boards of an investment company managed by the same manager.

Tetragon’s Compliance Statement

As noted above, Tetragon has not appointed a permanent Chairman. Instead a chairman is elected for each meeting of the Board of Directors. All members of the Board of Directors have the opportunity to declare any conflicts of interest that they may have at each meeting of the Board of Directors and the chairman is elected accordingly taking into account Provision 12.

13.
The board should identify in the annual report each non-executive director it considers to be independent. Circumstances which are likely to impair, or could appear to impair, a non-executive director’s independence include, but are not limited to, whether a director:

• has, or has had within the last three years, a material business relationship with the company or the manager, either directly or as a partner, shareholder, director or senior employee of a body that has such a relationship with the company or the manager;
• has received or receives additional remuneration from the company apart from a directors’ fee;
• has close family ties with any of the company’s advisers, directors or the manager;
• holds cross-directorships or has significant links with other directors through involvement in other companies or bodies. Directors who sit on the boards of more than one company managed by the same manager are entitled to serve as directors; however, they will not be regarded as independent for the purposes of fulfilling the requirement that there must be an independent majority;
• represents a significant shareholder; or
• has served on the board for more than nine years from the date of their first appointment.

Where any of these or other relevant circumstances apply, and the board nonetheless considers that the non-executive director is independent, a clear explanation should be provided. (Incorporates relevant content from UK Code Provision 10)

Tetragon’s Compliance Statement

The Independent Directors have been identified on its website and in the Governance section of its Annual Report (see Provision 10 for additional information).

14.
The board should appoint one of the independent non-executive directors to be the senior independent director to provide a sounding board for the chair and serve as an intermediary for the other directors and shareholders. Led by the senior independent director, the non-executive directors should meet without the chair present at least annually to appraise the chair’s performance, and on other occasions as necessary. (UK Code Provision 12)

Tetragon’s Compliance Statement

Tetragon has not appointed a senior Independent Director. The Board of Directors evaluates Tetragon’s and its own performance by means of open discussion at meetings of the Board of Directors or as otherwise required. The absence of a permanent chairman means that there is no need for the Independent Directors to meet separately to evaluate the chairman’s performance.

15.
The primary focus at regular board meetings should be a review of investment performance and associated matters such as gearing, asset allocation, attribution analysis, marketing/investor relations, peer group information and industry issues.

Tetragon’s Compliance Statement

The Board of Directors meets regularly to review and discuss the reports of the investment manager and to deal with any other corporate governance matters that may arise from time to time. The Board of Directors discussions include, as appropriate and necessary, those matters referenced by Provision 15.

16.
The board should explain in the annual report the areas of decision making reserved for the board and those over which the manager has discretion. Disclosure should include:

a discussion of the manager’s overall performance, for example, investment performance, portfolio risk, operational issues such as compliance etc.;
the manager’s remit regarding stewardship, for example voting and shareholder engagement, and environmental, social and corporate governance issues in respect of holdings in the company’s portfolio.
The board should also agree policies with the manager covering key operational issues.

Tetragon’s Compliance Statement

Tetragon has delegated management of Tetragon’s investment portfolio, determination of Tetragon’s investment strategy, approval of all significant investments by Tetragon, oversight of Tetragon’s risk monitoring, responsibility for portfolio risk management and oversight of key non-investment and risk activities to the investment manager.

Those roles and responsibilities not delegated to the investment manager are retained by the Board of Directors, along with general oversight of the activities of the investment manager. The Board of Directors oversees the performance by the investment manager of its duties through regular consideration of reports and presentations from the investment manager at quarterly meetings.

Tetragon’s administrator, TMF Group Fund Administration (Guernsey) Limited, circulates ad hoc updates from Tetragon’s regulator, the GFSC, and TMF’s compliance function monitors performance within the relevant Guernsey laws and GFSC rules and advises the Board of Directors of any issues or likely issues (generally on a quarterly basis).

Full details of the role and responsibilities of the Board, the investment manager, the administrator and other relevant service providers are detailed on Tetragon’s website.

17.
Non-executive directors should review at least annually the contractual relationships with, and scrutinise and hold to account the performance of, the manager.

Either the whole board or a management engagement committee consisting solely of directors independent of the manager (or executives) should perform this review at least annually with its decisions and rationale described in the annual report. If the whole board carries out this review, it should explain in the annual report why it has done so rather than establish a separate management engagement committee.

The company chair may be a member of, and may chair, the management engagement committee, provided that they are independent of the manager. (Incorporates relevant content from UK Code Provision 13)

Tetragon’s Compliance Statement

The Board of Directors has not deemed it necessary to appoint a separate management engagement committee. The Independent Directors undertake such functions as necessary on an ongoing basis.

18.
The board should monitor and evaluate other service providers (such as the company secretary, custodian, depositary, registrar and broker).

The board should establish procedures by which other service providers, should report back and the methods by which these providers are monitored and evaluated.

Tetragon’s Compliance Statement

Tetragon has delegated the monitoring and evaluation of its service providers to the investment manager. The investment manager raises relevant issues with the Board of Directors as appropriate.

19.
All directors should have access to the advice of the company secretary, who is responsible for advising the board on all governance matters. Both the appointment and removal of the company secretary should be a matter for the whole board. (UK Code Provision 16)

Tetragon’s Compliance Statement

The investment manager makes recommendations to the Board of Directors in relation to relevant governance matters. These recommendations are considered by the Board of Directors during the course of regular meetings.

20.
The directors should have access to independent professional advice at the company’s expense where they judge it necessary to discharge their responsibilities properly.

Tetragon’s Compliance Statement

All Directors have access to independent professional advice to enable them to properly discharge their responsibilities.

21.
Where a new company has been created by the manager, sponsor or other third party, the chair and the board should be selected and bought into the process of structuring a new launch at an early stage.

Tetragon’s Compliance Statement

Tetragon was established in 2005. Accordingly, this Provision is not applicable to Tetragon.

Principles

J.
Appointments to the board should be subject to a formal, rigorous and transparent procedure, and an effective succession plan should be maintained. Both appointments and succession plans should be based on merit and objective criteria. They should promote diversity, inclusion and equal opportunity. (Incorporates relevant content from UK Code Principle J)

K.
The board and its committees should have a combination of skills, experience and knowledge. Consideration should be given to the length of service of the board as a whole and membership regularly refreshed. (UK Code Principle K)

L.
Annual evaluation of the board should consider its performance, composition, diversity and how effectively members work together to achieve objectives. Individual evaluation should demonstrate whether each director continues to contribute effectively. (UK Code Principle L)

Provisions

22.
The board should establish a nomination committee to lead the process for appointments, ensure plans are in place for orderly succession to the board and oversee the development of a diverse pipeline for succession. A majority of members of the committee should be independent non-executive directors. If the board has decided that the entire board should fulfil the role of the nomination committee, it will need to explain why it has done so in the annual report. The chair of the board should not chair the committee when it is dealing with the appointment of their successor. (Incorporates relevant content from UK Code Provision)

Tetragon’s Compliance Statement

The Board of Directors has not deemed it necessary to appoint a nomination committee and undertakes any such functions collectively or it is undertaken by the Voting Shareholder.

23.
All directors should be subject to annual re-election. The board should set out in the papers accompanying the resolutions to elect each director the specific reasons why their contribution is, and continues to be, important to the company’s long-term sustainable success. (UK Code Provision 18)

Tetragon’s Compliance Statement

Directors are submitted for re-election by the Voting Shareholder at the Annual General Meeting and the procedures for re-election are disclosed in Tetragon’s Annual Report and on the Tetragon website.

24.
Each board should determine and disclose a policy on the tenure of the chair. A clear rationale for the expected tenure should be provided, and the policy should explain how this is consistent with the need for regular refreshment and diversity. (Incorporates relevant content from UK Code Provision 19)

Tetragon’s Compliance Statement

Tetragon does not operate a maximum threshold for tenure, nor any guaranteed tenure. As such, the Board of Directors has not deemed it necessary to prepare such a policy.

25.
Open advertising and/or an external search consultancy should generally be used for the appointment of the chair and non-executive directors. If an external search consultancy is engaged it should be identified in the annual report alongside a statement about any other connection it has with the company or individual directors. (UK Code Provision 20)

Tetragon’s Compliance Statement

All vacancies on the Board of Directors may be filled, and additional members may be appointed, by resolution of the Voting Shareholder.

26.
There should be a formal and rigorous annual evaluation of the performance of the board, its committees, the chair and individual directors. The chair should consider having a regular externally facilitated board performance review. In FTSE 350 companies this should happen at least every three years. The external reviewer should be identified in the annual report and a statement made about any other connection it has with the company or individual directors. (Incorporates relevant content from UK Code Provision 21)

Tetragon’s Compliance Statement

The Board of Directors evaluates its own performance and effectiveness, including of individual members of the Board of Directors and committees, by open discussion in Board of Directors meetings.

27.
The chair should act on the results of the board performance review by recognising the strengths and addressing any weaknesses of the board. Each director should engage with the process and take appropriate action when development needs have been identified. (UK Code Provision 22)

Tetragon’s Compliance Statement

All members of the Board of Directors engage in the evaluation process and take appropriate action when developmental needs have been identified.

28.
The annual report should describe the work of the nomination committee, (including where the whole board is acting as the nomination committee) including:

• the process used in relation to appointments, its approach to succession planning and how both support developing a diverse pipeline;
• how the board performance review has been conducted, the nature and extent of an external reviewer’s contact with the board and individual directors, the outcomes and actions taken, and how it has or will influence future board composition; and
• the policy and any initiatives on diversity and inclusion, their objectives and link to company strategy, how they have been implemented and progress on achieving the objectives. (Incorporates relevant content from UK Code Provision 23)

Tetragon’s Compliance Statement

As noted in relation to Provision 22, the Board of Directors has not deemed it necessary to appoint a nomination committee. The Board of Directors are collectively responsible for ensuring that the provisions of Tetragon’s Articles of Incorporation and of the relevant legislation, regulations and policies are followed in relation to the appointment and evaluation of the Directors.

Principles

M.
The board should establish formal and transparent policies and procedures to ensure the independence and effectiveness of external audit functions and satisfy itself on the integrity of financial and narrative statements. (Incorporates relevant content from UK Code Principle M)

N.
The board should present a fair, balanced and understandable assessment of the company’s position and prospects. (UK Code Principle N)

O.
The board should establish and maintain an effective risk management and internal control framework, and determine the nature and extent of the principal risks the company is willing to take in order to achieve its long-term strategic objectives. (UK Code Principle O)

Provisions

29.
The board should establish an audit committee of independent non-executive directors, with a minimum membership of three, or in the case of smaller companies two. The chair of the board should not chair the committee but can be a member if they were independent on appointment. If the chair of the board is a member of the audit committee, the board should explain in the annual report why it believes this is appropriate. The board should satisfy itself that at least one member has recent and relevant financial experience. The committee as a whole shall have competence relevant to the sector in which the company operates. (Incorporates relevant content from UK Code Provision 24)

Tetragon’s Compliance Statement

The Board of Directors has established an Audit Committee comprised of the three Independent Directors. The Audit Committee has recent and relevant financial experience. As noted in Provision 11, there is no permanent chairman for Tetragon. Similarly, there is no permanent chairman of the Audit Committee.

30.
The main roles and responsibilities of the audit committee should include:

• monitoring the integrity of the financial statements of the company and any formal announcements relating to the company’s financial performance, and reviewing significant financial reporting judgements contained in them;
• providing advice (where requested by the board) on whether the annual report and accounts, taken as a whole, is fair, balanced and understandable, and provides the information necessary for shareholders to assess the company’s position and performance, business model and strategy;
• following the Audit Committees and the External Audit: Minimum Standard;
• reviewing the company’s internal financial controls and internal control and risk management systems, unless expressly addressed by a separate board risk committee composed of independent non-executive directors, or by the board itself;
• conducting the tender process and making recommendations to the board, about the appointment, reappointment and removal of the external auditor, and approving the remuneration and terms of engagement of the external auditor;
• reviewing and monitoring the external auditor’s independence and objectivity;
• reviewing the effectiveness of the external audit process, taking into consideration relevant UK professional and regulatory requirements;
• developing and implementing policy on the engagement of the external auditor to supply non-audit services, ensuring there is prior approval of non-audit services, considering the impact this may have on independence, taking into account the relevant regulations and ethical guidance in this regard, and reporting to the board on any improvement or action required; and
• reporting to the board on how it has discharged its responsibilities. (Incorporates relevant content from UK Code Provision 25)

Tetragon’s Compliance Statement

The Audit Committee’s remit covers those matters identified by Provision 30. More specifically, the Audit Committee is responsible for, among other items, assisting and advising the Board of Directors with matters relating to Tetragon’s accounting and financial reporting processes and the integrity and audits of Tetragon’s financial statements. The Audit Committee is also responsible for reviewing and making recommendations with respect to the plans and results of each audit engagement with Tetragon’s independent accountants, the audit and non-audit fees charged by the independent accountants and the adequacy of internal accounting controls.

31.
The annual report should describe the work of the audit committee, including the matters set out in the Audit Committees and the External Audit: Minimum Standard. (Incorporates relevant content from UK Code Provision 26)

Tetragon’s Compliance Statement

The Audit Committee’s Statement can be found in the Governance section of Tetragon’s Annual Report.

32.
The directors should explain in the annual report their responsibility for preparing the annual report and accounts, and state that they consider the annual report and accounts, taken as a whole, is fair, balanced and understandable, and provides the information necessary for shareholders to assess the company’s position, performance, business model and strategy. (UK Code Provision 27)

Tetragon’s Compliance Statement

Please refer to the Directors’ Report in the Tetragon Annual Report.

33.
The board should carry out a robust assessment of the company’s emerging and principal risks. The board should confirm in the annual report that it has completed this assessment, including a description of its principal risks, and an explanation of how these are being managed or mitigated. The board should explain what procedures are in place to identify and manage emerging risks. (UK Code Provision 28)

Tetragon’s Compliance Statement

Tetragon has delegated the key responsibilities in relation to the assessment of Tetragon’s emerging and principal risks to the investment manager. Details of these risks are set out in Tetragon’s Annual Report and on its website (under the heading Risk Factors).

34.
The board should monitor the company’s risk management and internal control framework and, at least annually, carry out a review of its effectiveness. The monitoring and review should cover all material controls, including financial, operational and compliance controls. The board should provide in the annual report:

• A description of how the board has monitored and reviewed the effectiveness of the framework;
• A declaration of effectiveness of the material controls as at the balance sheet date; and
• A description of any material controls which have not operated effectively as at the balance sheet date, the action taken, or proposed, to improve them and any action taken to address previously reported issues. (UK Code Provision 29)

Tetragon’s Compliance Statement

Tetragon has delegated the key responsibilities in relation to the management of Tetragon’s risk management and internal control systems to the investment manager. Details of the investment manager’s review is included in the Manager’s Review section of Tetragon’s Annual Report.

35.
In annual and interim financial statements, the board should state whether it considers it appropriate to adopt the going concern basis of accounting in preparing them, and identify any material uncertainties to the company’s ability to continue to do so over a period of at least twelve months from the date of approval of the financial statements. (UK Code Provision 30)

Tetragon’s Compliance Statement

The Board of Directors complies with this provision as detailed in the Directors’ Report and Financial Statements in Tetragon’s Annual Report.

36.
Taking account of the company’s current position and principal risks, the board should explain in the annual report how it has assessed the prospects of the company, over what period it has done so and why it considers that period to be appropriate. The board should state whether it has a reasonable expectation that the company will be able to continue in operation and meet its liabilities as they fall due over the period of their assessment, drawing attention to any qualifications or assumptions as necessary. (UK Code Provision 31)

Tetragon’s Compliance Statement

The Board of Directors complies with this provision as detailed in the Directors’ Report and Key Performance Metrics in the Annual Report.

Principles

P.
Remuneration policies and practices should be designed to support strategy and promote long-term sustainable success. (Incorporates relevant content from UK Code Principle P)

Q.
A formal and transparent procedure for developing policy remuneration should be established. No director should be involved in deciding their own remuneration outcome. (Incorporates relevant content from UK Code Principle Q)

R.
Directors should exercise independent judgement and discretion when authorising remuneration outcomes, taking account of company and individual performance, and wider circumstances. (UK Code Principle R)

Provisions

37.
The board should establish a remuneration committee of independent non-executive directors with a minimum membership of three, or in the case of smaller companies, two. In addition, the chair of the board can only be a member if they were independent on appointment and cannot chair the committee. Before appointment as chair of the remuneration committee, the board should satisfy itself that the appointee has relevant experience and understanding of the company. If the board has decided that the entire board should fulfil the role of the remuneration committee, it will need to explain why it has done so in the annual report. (Incorporates relevant content from UK Code Provision 32)

Tetragon’s Compliance Statement

The Board of Directors has not deemed it necessary to establish a remuneration committee. To the extent necessary the members of the Board of Directors collectively fulfill the role of a remuneration committee.

38.
The remuneration committee should have delegated responsibility for determining the policy and setting the remuneration for the chair. (Incorporates relevant content from UK Code Provision 33)

Tetragon’s Compliance Statement

See above in relation to Provision 37.

39.
The remuneration of non-executive directors should be determined in accordance with the Articles of Association or, alternatively, by the board. Levels of remuneration for the chair and all non-executive directors should reflect the time commitment and responsibilities of the role. Remuneration for all non-executive directors should not include share options or other performance-related elements. Provision should be made for additional directors’ fees where directors are involved in duties beyond those normally expected as part of the director’s appointment. In such instances the board should provide details of the events, duties and responsibilities that gave rise to any additional directors’ fees in the annual report. (Incorporates relevant content from UK Code Provision 34)

Tetragon’s Compliance Statement

The remuneration of Tetragon’s Independent Directors has been determined by the Board of Directors. The remuneration of the Independent Directors reflects a number of factors, including the time commitment and responsibilities of the role. The remuneration currently includes restricted Tetragon share grants and the opportunity to invest on preferential fee terms in TFG Asset Management products.

40.
Where a remuneration consultant is appointed, this should be the responsibility of the remuneration committee. The consultant should be identified in the annual report alongside a statement about any other connection it has with the company or individual directors. Independent judgement should be exercised when evaluating the advice of external third parties. (Incorporates relevant content from UK Code Provision 35)

Tetragon’s Compliance Statement

Tetragon has not appointed a remuneration consultant.

41.
The main role and responsibilities of the remuneration committee should include:

in conjunction with the chair, setting the directors’ remuneration levels; and
considering the need to appoint external remuneration consultants.

Tetragon’s Compliance Statement

See above in relation to Provision 37.

42.
There should be a description of the work of the remuneration committee in the annual report. (Incorporates relevant content from UK Code Provision 41)

Tetragon’s Compliance Statement

See above in relation to Provision 37.