EPE Special Opportunities : Notice of EGM 13 December 202118 November 2021

THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION. If you are in any doubt about the contents of this document, or the action you should take, you are recommended to seek your own financial advice immediately from an independent financial adviser who, if you are taking advice in the United Kingdom, is duly authorised under the Financial Services and Markets Act 2000, or if you are in a territory outside the United Kingdom, is an appropriately authorised independent financial adviser.

If you have sold or otherwise transferred all of your shares in the Company, you should send this document, but not the accompanying personalised Form of Proxy or Form of Instruction, at once to the purchaser or transferee or to the person through whom the sale or transfer was effected for delivery to the purchaser or transferee.

EPE SPECIAL OPPORTUNITIES LIMITED

(Incorporated in Bermuda under the Companies Act 1981, as amended, with company number 53954)

PROPOSED CREATION AND ISSUE OF ZDP SHARES

AND

NOTICE OF EXTRAORDINARY GENERAL MEETING

This document should be read as a whole. Nevertheless, your attention is drawn to the Letter from the Chairman in which the Directors recommend that you vote in favour of the Resolution to be proposed at the Extraordinary General Meeting referred to below.

Notice of the Extraordinary General Meeting to be held at Liberation House, Castle Street, St Helier, Jersey, JE1 2LH at 9 a.m. on 13 December 2021 is set out at the end of this document.

The Company is closely monitoring the COVID-19 situation, including the guidance issued by the States of Jersey, and will continue to do so in the lead up to the Extraordinary General Meeting. The Extraordinary General Meeting is currently intended to be an open meeting allowing Shareholders to attend in person. The COVID-19 situation is constantly evolving and the States of Jersey may change current guidance and/or travel restrictions for people arriving in Jersey at short notice. Updates on any changes to the proceedings of the Extraordinary General Meeting will be published on the Company's website (www.epespecialopportunities.com) and notified by the Company through a Regulatory Information Service announcement. As such, the Board encourages all Shareholders to appoint the chairman of the meeting as their proxy as early as possible in order to vote on the matter being considered at the Extraordinary General Meeting. As it may be difficult for certain Shareholders to attend the Extraordinary General Meeting physically for the reasons set out above, the vote on the Resolution contained in the Notice of Extraordinary General Meeting will be held by poll, which the Board feels is the fairest approach in the circumstances. Therefore, all valid proxy votes exercised by the chairman of the meeting, whether submitted electronically or in hard copy form, will be included in the votes to be taken at the Extraordinary General Meeting.

Shareholders are asked to submit any questions on the business to be dealt with at the Extraordinary General Meeting to the Company Secretary via eso@langhamhall.com in advance of the Extraordinary General Meeting. The Company Secretary will then endeavor to respond to relevant Shareholder queries.

Shareholders are requested to complete and return the Form of Proxy or Form of Instruction accompanying this document for use at the Extraordinary General Meeting. To be valid, Forms of Proxy and Forms of Instruction must be completed and returned in accordance with the instructions printed thereon as soon as possible and in any event so as to arrive by no later than 9.00 a.m. on 9 December 2021 and 9.00 a.m. on 8 December 2021 respectively. The Form of Proxy and Form of Instruction can be returned by delivery to the offices of the Company's registrars, Computershare Investor Services (Jersey) Limited, c/o The Pavilions, Bridgwater Road, Bristol BS99 6ZY, online at www.investorcentre.co.uk/eproxy, at the email address: externalproxyqueries@computershare.co.uk, or in the case of CREST members, by utilising the CREST electronic proxy appointment service in accordance with the procedures set out in the Notice of Extraordinary General Meeting and the CREST Manual on the Euroclear website (www.euroclear.com). Completion and return of a Form of Proxy or a Form of Instruction will not preclude Shareholders from attending and voting at the Extraordinary General Meeting should they choose to do so, subject to the restrictions on attendance set out above. Further instructions relating to the Form of Proxy and the Form of Instruction are set out in the Notice of Extraordinary General Meeting and the Form of Proxy or the Form of Instruction (as appropriate).

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Expected Timetable

References to times in this document are to London times unless otherwise stated. Any changes to the expected timetable will be notified by the Company through a Regulatory Information Service announcement.

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Letter from the Chairman

EPE SPECIAL OPPORTUNITIES LIMITED

(Incorporated in Bermuda under the Companies Act 1981, as amended, with company number 53954)

Proposed creation and issue of ZDP Shares

and

Notice of Extraordinary General Meeting

1. INTRODUCTION

The Company is announcing proposals to raise up to £25 million to invest in accordance with the Company's investing policy. The proposals together comprise an issue of up to 25 million ZDP Shares at £1.00 per ZDP Share pursuant to an institutional placing (the "Placing"). The Placing is conditional upon, amongst other things, the Company obtaining Shareholder approval for the creation and issue of ZDP Shares.

The purpose of this document is to give Shareholders details of the Extraordinary General Meeting being convened at which the Resolution required to implement the Placing will be proposed, as well as the background to the Placing and the reasons why the Board is recommending that you vote in favour of the Resolution at the Extraordinary General Meeting.

2. BACKGROUND TO THE PLACING

The Directors believe that the creation and issue of the ZDP Shares will be beneficial for the Company by providing greater diversity to the Company's sources of capital which in turn may enable the Company to grow its portfolio of investments and seek to generate attractive returns for holders of Ordinary Shares. The Company will use the proceeds resulting from the issue of any ZDP Shares to allow it to maintain significant cash balances whilst continuing to invest in accordance with the Company's investing policy

The Company continues to review a healthy pipeline of investment opportunities in which to deploy further capital. The Company consistently targets proprietary deal opportunities. Deals are also sourced from a network of industry contacts including operating partners and corporate finance advisors. EPIC Investment Partners, the Investment Advisor to the Company typically reviews c.300 deals per annum in the UK lower mid-market.

The terms of the proposed Placing of ZDP Shares will be set out in the Prospectus and a summary of those terms are set out below.

The Placing comprises up to 25 million ZDP Shares. The Placing is conditional, inter alia, on: (i) Admission having become effective on or before 8.00 a.m. on 16 December 2021 or such later time and/or date as the Company and Liberum may agree (being not later than 8.00 a.m. on 31 January 2022); (ii) the passing of the Resolution; and (iii) the placing agreement to be entered into between the Company and Liberum becoming wholly unconditional in respect of the Placing (save as to Admission) and not having been terminated in accordance with its terms at any time prior to Admission.

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The total number of ZDP Shares to be issued pursuant to the Placing, and therefore the gross proceeds of the Placing are not known as at the date of this document but will be notified by the Company via a Regulatory Information Service in due course.

3. SUMMARY OF THE PROPOSED RIGHTS ATTACHING TO THE ZDP SHARES

The following is a summary only and is qualified in full by the information set out in the Prospectus relating to the rights attaching to the ZDP Shares.

The ZDP Shares are expected to have a maturity date in 2027 and will be issued at a Gross Redemption Yield that reflects the current market for equivalent zero dividend preference shares. By way of illustration, if the mean gross redemption yield for equivalent zero dividend preference shares at issuance was 4.5 per cent., such gross redemption yield on the Placing Price would result in a Final Capital Entitlement of approximately 130 pence per ZDP Share (assuming a six year term).

The Gross Redemption Yield will be included in the Prospectus to be published by the Company ahead of the date of the EGM.

The Gross Redemption Yield of a ZDP Share is not and should not be taken as a forecast of profits and there can be no assurance that the Final Capital Entitlement of the ZDP Shares will be repaid in full on the ZDP Repayment Date. On the basis of a raise of £25 million, a five year term and the illustrative Gross Redemption Yield above, the ZDP Shares would have a final cover of approximately 6 times.

On a return of capital, on a winding up or otherwise, subject to the Bermuda Companies Act, ZDP Shareholders will be entitled to receive an amount equal to the initial capital entitlement of 100 pence per ZDP Share as increased at such rate as accrues daily and compounds annually to give an entitlement to the Final Capital Entitlement at the ZDP Repayment Date per ZDP Share, the first such increase to be deemed to have occurred on the date the ZDP Shares are issued and the last to occur on the ZDP Repayment Date. Potential investors should note, however, that a Final Capital Entitlement will not be a guaranteed or secured repayment amount.

The Final Capital Entitlement will rank behind any bank debt of the Company and in priority to the capital entitlements of the Ordinary Shares. The ZDP Shares carry no entitlement to income and the whole of their potential return, therefore, takes the form of capital.

The ZDP Shares do not carry the right to vote at general meetings of the Company, although they carry the right to vote as a class on certain proposals which would be likely to materially affect their position (see the terms of the ZDP Shares set out at the Schedule to the Notice of Extraordinary General Meeting for further details). Further ZDP Shares (or any shares or securities which rank in priority to or pari passu with the ZDP Shares) may be issued without the separate class approval of the ZDP Shareholders provided that the Directors determine that the ZDP Shares would have a cover of not less than four times immediately following such issue.

4. THE PROSPECTUS

The Company is required to publish a prospectus in connection with the proposals and intends to do so shortly. The Prospectus, when published, will be available on the Company's website (www.epespecialopportunities.com) and the National Storage Mechanism of the FCA at https://data.fca.org.uk/#/nsm/nationalstoragemechanism.

5. RISKS ASSOCIATED WITH THE ZDP SHARES

Shareholders should have regard to the following risk factors when considering the Resolution.

The value attributable to the Ordinary Shares will depend on the Company's ability to meet the capital entitlements of the ZDP Shares (if issued)

The Ordinary Shares should be regarded as carrying above average risk since the Net Asset Value per Share will be dependent upon the Company's assets being sufficient to meet the prior entitlements of the holders of the ZDP Shares.

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