Korea Fund Inc SC TO-I, filed Aug 16, 2024
Korea Fund Inc (KF)
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON AUGUST 16, 2024
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE TO
ISSUER TENDER OFFER STATEMENT
UNDER SECTION 13(e)(1) OF THE
SECURITIES EXCHANGE ACT OF 1934
THE KOREA FUND, INC.
(Name of Subject Company)
THE KOREA FUND, INC.
(Name of Filing Person (Issuer))
COMMON SHARES OF BENEFICIAL INTEREST, PAR VALUE $0.01 PER SHARE
(Title of Class of Securities)
500634209
(CUSIP Number of Class of Securities)
c/o Carmine Lekstutis
JPMorgan
4 New York Plaza
New York, NY 10004
(Name, Address and Telephone Number of Person Authorized to Receive
Notices and Communications on Behalf of Filing Person)
Copies to:
David C. Sullivan, Esq.
Ropes & Gray LLP
Prudential Tower
800 Boylston Street
Boston, MA 02199
August 16, 2024
(Date Tender Offer First Published, Sent or Given to Security Holders)
| [ ] | Check the box if the filing relates solely to preliminary communications made before the commencement of a tender offer. |
Check the appropriate boxes below to designate any transactions to which the statement relates:
| [ ] | third party tender offer subject to Rule 14d-1. |
| [X] | issuer tender offer subject to Rule 13e-4. |
| [ ] | going-private transaction subject to Rule 13e-3. |
| [ ] | amendment to Schedule 13D under Rule 13d-2. |
Check the following box if the filing is a final amendment reporting the results of the tender offer. [ ]
EXPLANATORY NOTE
Copies of the Offer to Purchase, dated August 16, 2024, and the Letter of Transmittal, among other documents, have been filed by The Korea Fund, Inc. (the “Fund”) as Exhibits to this Schedule TO, Tender Offer Statement (the “Schedule”), pursuant to Section 13(e)(1) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Unless otherwise indicated, all material incorporated herein by reference in response to items or sub-items of this Schedule is incorporated by reference from the corresponding caption in the Offer to Purchase, including the information provided under those captions.
ITEM 1. SUMMARY TERM SHEET.
Reference is hereby made to the Summary Term Sheet included in the Offer to Purchase, which is attached as Exhibit (a)(1)(i) and is incorporated herein by reference.
ITEM 2. SUBJECT COMPANY INFORMATION.
(a) The name of the issuer is The Korea Fund, Inc. (previously defined as the “Fund”), a non-diversified, closed-end management investment company organized as a Maryland corporation. The principal executive offices of the Fund are located at 60 Victoria Embankment, London, EC4Y 0JP. The Fund’s telephone number is +44 207 742 3436.
(b) The title of the subject class of equity securities described in the offer is Common Shares of beneficial interest, par value $0.01 per share (the “Shares”). As of July 10, 2024, there were 4,833,153 Shares of the Fund issued and outstanding.
(c) The principal market in which the Shares are traded is the New York Stock Exchange (“NYSE”). The Fund began trading on the NYSE on August 22, 1984. For information on the high, low and closing (as of the close of ordinary trading on the NYSE on the last day of each of the Fund’s fiscal quarters) market prices of the Shares in such principal market for each fiscal quarter since July 1, 2022, see Section 8, “Price Range of Shares” of the Offer to Purchase, which is incorporated herein by reference.
(d) The Fund had no income or capital gains eligible for distribution arising during fiscal years ending June 30, 2023 and June 30, 2024.
(e) Not applicable.
(f) Under the terms of the Fund’s current share repurchase program, the Fund may repurchase up to 10% of its outstanding shares in each twelve-month period ended June 30 at differing discount threshold levels that are not publicly announced. The Fund is prohibited, however, from repurchasing its shares pursuant to the share repurchase program during periods when the Fund also has an outstanding tender offer.
As of the end of the following fiscal quarters for the period commencing July 1, 2023, the Fund has cumulatively repurchased and retired its Shares as shown in the following table.
| Fiscal Quarter Ended | TOTAL NUMBER OF SHARES (OR UNITS) PURCHASED |
RANGE OF PRICES PAID |
AVERAGE PRICE PAID | |||
| September 30, 2023 |
12,899 | $20.77630 - $24.18079 | $22.39279 | |||
| December 31, 2023 |
38,112 | $18.58700 - $23.74440 | $21.32407 | |||
| March 31, 2024 |
28,363 | $20.81640 - $23.46290 | $22.16859 | |||
| June 30, 2024 |
15,888 | $23.05840 - $24.31000 | $23.59948 | |||
| TOTAL |
95,262 |
ITEM 3. IDENTITY AND BACKGROUND OF FILING PERSON.
(a) The Fund is a non-diversified, closed-end management investment company registered under the Investment Company Act of 1940, as amended (the “1940 Act”), and organized as a Maryland corporation. The Fund’s President and Chief Executive Officer and the Treasurer, Principal Financial and Accounting Officer of the Fund are both located at 60 Victoria Embankment, London, EC4Y 0JP. The Fund’s telephone number is +44 207 742 3436. The filing person is the subject company. The members of the Board of Directors of the Fund are: Julian M. I. Reid, Richard A. Silver, Matthew J. Sippel and Madam Yan Hu. Each member of the Board of
Directors is not an “interested person” of the fund, as that term is defined in the 1940 Act (the “Independent Directors” or the “Directors”).
The executive officers of the Fund are Simon J. Crinage, President and Chief Executive Officer, Neil S. Martin, Treasurer, Principal Financial and Accounting Officer, Paul F. Winship, Vice President and Secretary, Carmine Lekstutis, Chief Legal Officer and Stephen M. Ungerman, Chief Compliance Officer.
Correspondence to the Directors and executive officers of the Fund should be mailed to The Korea Fund, Inc., c/o JPMorgan Funds Limited, 60 Victoria Embankment, London, EC4Y 0JP, Attn: Paul Winship / Secretary.
ITEM 4. TERMS OF THE TRANSACTION.
(a) The Fund’s Board of Directors has determined to commence an offer to purchase up to 12.5%, or 604,144 Shares, of the Fund’s issued and outstanding common chares (the “Common Shares” or “Shares”). The offer is for cash at a price equal to 98.5% of the Fund’s net asset value per share (“NAV”) as of the close of ordinary trading on the NYSE on September 16, 2024, or if the Offer period is extended, as of the close of ordinary trading on the NYSE on the newly designated expiration date, upon the terms and subject to the conditions set forth in the enclosed Offer to Purchase and the related Letter of Transmittal (which together constitute the “Offer”).
A copy of the Offer to Purchase and the Letter of Transmittal is attached hereto as Exhibit (a)(1)(i) and Exhibit (a)(1)(ii), respectively, each of which is incorporated herein by reference. For more information on the type and amount of consideration offered to stockholders, the scheduled expiration date, extending the Offer and the Fund’s intentions in the event of oversubscription, see Section 1, “Price; Number of Shares” and Section 15, “Extension of Tender Period; Termination; Amendments” of the Offer to Purchase. For information on the dates relating to the withdrawal of tendered Shares, the procedures for tendering Shares and withdrawing Shares tendered, and the manner in which Shares will be accepted for payment, see Section 2, “Procedures for Tendering Shares,” Section 3, “Withdrawal Rights,” and Section 4, “Payment for Shares” in the Offer to Purchase. For information on the federal income tax consequences of the Offer, see Section 2, “Procedures for Tendering Shares,” Section 10, “Certain Effects of the Offer,” and Section 14, “Certain Federal Income Tax Consequences,” in the Offer to Purchase.
(b) The Fund has been advised that neither its Directors, officers nor investment adviser intend to tender any Shares pursuant to the Offer. Therefore, the Fund does not intend to purchase Shares from any officer, Director or investment adviser of the Fund pursuant to the Offer.
ITEM 5. PAST CONTACTS, TRANSACTIONS, NEGOTIATIONS AND AGREEMENTS.
(e) Reference is hereby made to Section 7, “Plans or Proposals of the Fund,” Section 9, “Interest of Directors and Executive Officers; Transactions and Arrangements Concerning the Shares,” and Section 16, “Fees and Expenses” of the Offer to Purchase, each of which is incorporated herein by reference. Except as set forth therein, the Fund does not know of any agreement, arrangement or understanding, whether or not legally enforceable, between the Fund (including any of the Fund’s executive officers or Directors, any person controlling the Fund or any officer or director of any corporation or other person ultimately in control of the Fund) and any other person with respect to any securities of the Fund. The foregoing includes, but is not limited to: the transfer or the voting of securities, joint ventures, loan or option arrangements, puts or calls, guarantees of loans, guarantees against loss, or the giving or withholding of proxies, consents or authorizations.
ITEM 6. PURPOSES OF THE TRANSACTION AND PLANS OR PROPOSALS.
(a)-(c) Reference is hereby made to Section 1, “Price; Number of Shares,” Section 6, “Purpose of the Offer,” Section 7, “Plans or Proposals of the Fund,” Section 10, “Certain Effects of the Offer,” and Section 11, “Source and Amount of Funds” of the Offer to Purchase, each of which is incorporated herein by reference. Except as noted herein and therein, the events listed in Item 1006(c) of Regulation M-A are not applicable to the Fund (including any of the Fund’s executive officers or Directors, any person controlling the Fund or any officer or director of any corporation or other person ultimately in control of the Fund).
ITEM 7. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
(a)-(b) Reference is hereby made to Section 11, “Source and Amount of Funds” of the Offer to Purchase, which is incorporated herein by reference.
(d) Not applicable.
The information requested by Item 1007(a), (b) and (d) of Regulation M-A is not applicable to the Fund’s executive officers and Directors, any person controlling the Fund or any executive officer or director of a corporation or other person ultimately in control of the Fund.
ITEM 8. INTEREST IN SECURITIES OF THE SUBJECT COMPANY.
(a)-(b) Reference is hereby made to Section 9, “Interest of Directors and Executive Officers; Transactions and Arrangements Concerning the Shares” of the Offer to Purchase, each of which is incorporated herein by reference.
As of May 10, 2024, City of London Investment Group PLC, located at 77 Gracechurch Street, London, England, beneficially owned 1,209,604 common shares of the Fund, an amount equal to 25.03 percent of the Fund’s outstanding common shares.1
As of February 15, 2024, Lazard Asset Management LLC, located at 50 Stratton St, London England W1J 8LL, beneficially owned 749,807 common shares of the Fund, an amount equal to 15.36 percent of the Fund’s outstanding common shares.2
Under the terms of the Fund’s current share repurchase program, the Fund may repurchase up to 10% of its outstanding shares in each twelve-month period ended June 30 at differing discount threshold levels that are not publicly announced. The Fund is prohibited, however, from repurchasing its shares pursuant to the share repurchase program during periods when the Fund also has an outstanding tender offer. Except for the transactions listed below that were a part of the Fund’s revised share repurchase program, there have not been any transactions in the Shares of the Fund that were effected during the past 60 days by the Fund.
| Date | Amount of shares repurchased | Price per share | ||
|
6/18/24 |
7 | 23.97000 | ||
| 6/20/24 |
800 | 24.05630 | ||
| 6/21/24 |
708 | 23.76430 | ||
| 6/24/24 |
890 | 23.85730 | ||
| 6/26/24 |
20 | 23.90000 | ||
| 6/27/24 |
177 | 24.03560 | ||
| 7/1/24 |
674 | 24.22880 | ||
| 7/2/24 |
95 | 24.43160 |
In addition, based upon the Fund’s records and upon information provided to the Fund by its Directors, executive officers and affiliates (as such term is used in Rule 12b-2 under the Exchange Act), to the best of the Fund’s knowledge, there have not been any transactions involving the Shares of the Fund that were effected during the past 60 days by any executive officer or Director of the Fund, any person controlling the Fund, any executive officer or director of any corporation or other person ultimately in control of the Fund or by any associate or subsidiary of any of the foregoing, including any executive officer or director of any such subsidiary.
1 Based on a Schedule 13G/A filed by City of London Investment Group PLC with the SEC on May 10, 2024.
2 Based on a Schedule 13G/A filed by Lazard Asset Management LLC with the SEC on February 15, 2024.
ITEM 9. PERSONS/ASSETS RETAINED, EMPLOYED, COMPENSATED OR USED.
(a) No persons have been employed, retained or are to be compensated by or on behalf of the Fund to make solicitations or recommendations in connection with the Offer.
ITEM 10. FINANCIAL STATEMENTS.
Not applicable.
ITEM 11. ADDITIONAL INFORMATION.
(a)(1) Reference is hereby made to Section 9, “Interest of Directors and Executive Officers; Transactions and Arrangements Concerning the Shares” of the Offer to Purchase, which is incorporated herein by reference.
(a)(2)-(5) Not applicable.
(b) Reference is hereby made to the Offer to Purchase, which is incorporated herein by reference.
ITEM 12. EXHIBITS.
| (a)(1)(i) |
Letter to Shareholders from the Chairman of the Board of Directors of the Fund and Offer to Purchase. | |
| (a)(1)(ii) |
Letter of Transmittal. | |
| (a)(1)(iii) |
Letter to Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees. | |
| (a)(1)(iv) |
Letter to Clients and Client Instruction Form. | |
| (a)(1)(v) |
Notice of Guaranteed Delivery. | |
| (a)(1)(vi) |
Notice of Withdrawal. | |
| (a)(2) |
Not applicable. | |
| (a)(3) |
Not applicable. | |
| (a)(4) |
Not applicable. | |
| (a)(5)(i) |
Press Release dated July 10, 2024. | |
| (a)(5)(ii) |
Press Release dated August 16, 2024. | |
| (b) |
Not applicable. | |
| (d) |
Not applicable. | |
| (g) |
Not applicable. | |
| (h) 107 |
Not applicable. |
SIGNATURE
After due inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.
| THE KOREA FUND, INC. | ||
| /s/ Simon J. Crinage |
||
| Simon J. Crinage | ||
| President and Chief Executive Officer | ||
August 16, 2024
EXHIBIT INDEX
| EXHIBIT | DESCRIPTION | |
| (a)(1)(i) | Letter to Shareholders from the Chairman of the Board of Directors of the Fund and Offer to Purchase. | |
| (a)(1)(ii) | Letter of Transmittal. | |
| (a)(1)(iii) | Letter to Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees. | |
| (a)(1)(iv) | Letter to Clients and Client Instruction Form. | |
| (a)(1)(v) | Notice of Guaranteed Delivery. | |
| (a)(1)(vi) | Notice of Withdrawal. | |
| (a)(5)(i) | Press Release dated July 10, 2024. | |
| (a)(5)(ii) | Press Release dated August 16, 2024. | |
| 107 | Filing Fees – Calculation of Filing Fee Table. |
Exhibit (a)(1)(i)
The Korea Fund, Inc.
60 Victoria Embankment
London, EC4Y 0JP
August 16, 2024
Dear Stockholder:
On July 8, 2024, the Board of Directors of The Korea Fund, Inc. (the “Fund”) approved a tender offer for the Fund’s common shares of beneficial interest (“Common Shares”). The Fund is commencing an offer to purchase up to 12.5% of its issued and outstanding Common Shares upon the terms and subject to the conditions set forth in the enclosed Offer to Purchase and the related Letter of Transmittal (which together constitute the “Offer”). If more than 12.5% of the Common Shares are tendered and not withdrawn, any purchases will be made on a pro rata basis. The offer is for cash at a price equal to 98.5% of the Fund’s net asset value per share (“NAV”) as of the close of ordinary trading on the New York Stock Exchange (“NYSE”) on the day the offer expires (as described below). The Offer is designed to provide stockholders of the Fund with the opportunity to redeem some or all of their shares at a price very close to NAV should they wish to do so.
In order to participate, the materials described in the Offer must be delivered to Equiniti Trust Company, LLC (“Equiniti”) by 5:00 p.m. New York City time, September 16, 2024, or such later date to which the Offer is extended (the “Expiration Date”). The pricing time and date for the Offer is currently scheduled to be the close of ordinary trading on the NYSE on September 16, 2024. Should the Offer be extended beyond September 16, 2024, the pricing date will be the close of ordinary trading on the NYSE on the newly designated Expiration Date. The amount to be paid per share will be 98.5% of the NAV of the Common Shares as of the close of ordinary trading on the NYSE on the Expiration Date. Stockholders who choose to participate in the Offer can expect payments for shares tendered and accepted to be mailed, or otherwise delivered, within approximately ten business days after the Expiration Date.
If, after carefully evaluating all of the information set forth in the Offer to Purchase, you wish to tender shares pursuant to the Offer, please follow the instructions contained in the Offer to Purchase and Letter of Transmittal or, if your shares are held of record in the name of a broker, dealer, commercial bank, trust company or other nominee, contact that firm to effect the tender for you. Stockholders are urged to consult their own investment and tax advisers and make their own decisions whether to tender any shares and, if so, how many shares to tender.
As of the close of ordinary trading on the NYSE on August 12, 2024, the Fund’s NAV was $27.07 per Common Share and 4,833,153 Common Shares were issued and outstanding. The Fund’s NAV during the pendency of this Offer may be obtained by contacting EQ Fund Solutions (“EQ”), the Fund’s Information Agent, toll free at (877) 361-7964.
NEITHER THE FUND NOR ITS BOARD OF DIRECTORS IS MAKING ANY RECOMMENDATION TO ANY STOCKHOLDER WHETHER TO TENDER OR REFRAIN FROM TENDERING SHARES IN THE OFFER. THE FUND AND BOARD URGE EACH STOCKHOLDER TO READ AND EVALUATE THE OFFER AND RELATED MATERIALS CAREFULLY AND MAKE HIS OR HER OWN DECISION. QUESTIONS, REQUESTS FOR ASSISTANCE AND REQUESTS FOR ADDITIONAL COPIES OF THE OFFER SHOULD BE DIRECTED TO EQ AT (877) 361-7964.
| Sincerely,
|
| Julian Reid |
| Chairman of the Board of Directors |
OFFER TO PURCHASE
THE KOREA FUND, INC.
OFFER TO PURCHASE FOR CASH UP TO 604,144
OUTSTANDING COMMON SHARES OF BENEFICIAL INTEREST
SUMMARY TERM SHEET
THIS SUMMARY HIGHLIGHTS CERTAIN INFORMATION IN THIS OFFER TO PURCHASE. TO UNDERSTAND THE OFFER FULLY AND FOR A MORE COMPLETE DESCRIPTION OF THE TERMS OF THE OFFER, YOU SHOULD READ CAREFULLY THIS ENTIRE OFFER TO PURCHASE AND THE RELATED LETTER OF TRANSMITTAL. WE HAVE INCLUDED SECTION REFERENCES PARENTHETICALLY TO DIRECT YOU TO A MORE COMPLETE DESCRIPTION IN THE OFFER TO PURCHASE OF THE TOPICS IN THIS SUMMARY.
What and how many securities is The Korea Fund, Inc. (the “Fund”) offering to purchase? (See Section 1, “Price; Number of Shares”)
The Fund is offering (the “Offer”) to purchase up to 12.5% or 604,144 (the “Offer Amount”) of its common shares of beneficial interest (“Common Shares” or “Shares”). If the number of Shares properly tendered and not withdrawn prior to the date and time the Offer expires is less than or equal to the Offer Amount, the Fund will, upon the terms and subject to the conditions of the Offer, purchase all Shares tendered. If more Shares than the Offer Amount are properly tendered and not withdrawn prior to the date the Offer expires, the Fund will purchase the Offer Amount on a pro rata basis. Stockholders cannot be assured that all of their tendered Shares will be repurchased.
How much and in what form will the Fund pay me for my Shares? (See Section 1, “Price; Number of Shares” and Section 4, “Payment for Shares”)
The Fund will pay cash for Shares purchased pursuant to the Offer. The purchase price will equal 98.5% of the net asset value per Share (“NAV”), as of the close of ordinary trading on the New York Stock Exchange (the “NYSE”) on September 16, 2024, unless the Offer is extended (the “Expiration Date”). As of August 12, 2024, the Fund’s NAV was $27.07 per Share. Of course, the NAV can change every business day. You can obtain current NAV quotations from EQ Fund Solutions (“EQ”), the information agent for the Offer (“Information Agent”) at (877) 361-7964.
When does the Offer expire? Can the Fund extend the Offer, and if so, when will the Fund announce the extension? (See Section 1, “Price; Number of Shares” and Section 15, “Extension of Tender Period; Termination; Amendments”)
| · | The Offer expires on September 16, 2024, at 5:00 p.m., New York City time, unless the Fund extends the Offer. |
| · | The Fund may extend the Offer period at any time. If it does, the Fund will determine the purchase price as of the close of ordinary trading on the NYSE on the new Expiration Date. |
| · | If the Offer period is extended, the Fund will make a public announcement of the extension no later than 9:30 a.m. New York City time on the next business day following the previously scheduled Expiration Date. |
Will I have to pay any fees or commissions on Shares I tender? (See Section 1, “Price; Number of Shares,” Section 4, “Payment for Shares” and Section 16, “Fees and Expenses”)
Shares will be purchased at 98.5% of the Fund’s NAV to help defray certain costs of the tender, including the processing of tender forms, effecting payment, postage and handling. Excess costs associated with the tender, if any, will be charged against the Fund’s capital. The Fund will not charge a separate service fee in conjunction with the Offer. If your Shares are held through a financial intermediary, the financial intermediary may charge you a service fee for participation in the Offer.
Does the Fund have the financial resources to pay me for my Shares? (See Section 11, “Source and Amount of Funds”)
Yes. If the Fund purchased 604,144 Shares at 98.5% of the August 12, 2024 NAV of $27.07 per Share, the Fund’s total cost, not including fees and expenses incurred in connection with the Offer, would be approximately $16,108,865. The Fund intends to first use
(i)
cash on hand to pay for Shares tendered, and then intends to sell portfolio securities to raise any additional cash needed for the purchase of Shares. The Fund will not borrow money to finance the purchase of Shares in the Offer.
How do I tender my Shares? (See Section 2, “Procedures for Tendering Shares”)
If your Shares are registered in the name of a nominee holder, such as a broker, dealer, commercial bank, trust company or other nominee (“Nominee Holder”), you should contact that firm if you wish to tender your Shares.
All other stockholders wishing to participate in the Offer must, prior to the date and time the Offer expires, EITHER:
| · | Complete and execute a Letter of Transmittal, together with any required signature guarantees, and any other documents required by the Letter of Transmittal. You must send these materials to Equiniti Trust Company, LLC (the “Depositary”) at its address set forth on page (v) of this Offer. If you hold certificates for Shares, you must send the certificates to the Depositary at its address set forth on page (v) of this Offer. If your Shares are held in book-entry form, you must comply with the book-entry delivery procedure set forth in Section 2.C of this Offer. In all these cases, the Depositary must receive these materials prior to the date and time the Offer expires. |
OR
| · | Comply with the Guaranteed Delivery Procedure set forth in Section 2.D of this Offer. |
The Fund’s transfer agent holds Shares in uncertificated form for certain stockholders pursuant to the Fund’s dividend reinvestment plan. When a stockholder tenders share certificates, the Depositary will accept any of the stockholder’s uncertificated Shares for tender first, and accept the balance of tendered Shares from the stockholder’s certificated Shares.
Until what time can I withdraw tendered Shares? (See Section 3, “Withdrawal Rights”)
You may withdraw your tendered Shares at any time prior to the Expiration Date. You may not withdraw your shares after 5:00 p.m. New York City time, on September 16, 2024 through October 15, 2024. If the Fund has not yet accepted tendered Shares for payment by October 15, 2024, you may withdraw your tendered Shares.
How do I withdraw tendered Shares? (See Section 3, “Withdrawal Rights”)
If you desire to withdraw tendered Shares, you should either:
| · | Give proper written notice to the Depositary; or |
| · | If your Shares are held of record in the name of a Nominee Holder, contact that firm to withdraw your tendered Shares. |
Will there be any tax consequences to tendering my Shares? (See Section 2, “Procedures for Tendering Shares,” Section 10, “Certain Effects of the Offer” and Section 14, “Certain U.S. Federal Income Tax Consequences”)
Yes. If your tendered Shares are purchased, it will be a taxable transaction treated either as a sale or exchange or, as a so-called “section 301 distribution” treated in whole or in part as a taxable dividend. See Sections 2, 10 and 14 for further details. Each stockholder should consult its tax adviser as to the tax consequences of tendering its Shares in the Offer.
What is the purpose of the Offer? (See Section 6, “Purpose of the Offer”)
This tender offer is being conducted as a result of a policy (the “Tender Offer Policy”) adopted by the Fund’s Board of Directors in December 2020. Pursuant to the Tender Offer Policy, the Board will cause the Fund to conduct an issuer tender offer for up to twenty-five percent (25%) of its then issued and outstanding shares of common stock on or before September 30, 2024, and thereafter on each third year anniversary of September 30, 2024, if the Fund’s total return investment performance measured on a NAV basis does not equal or exceed the total return investment performance of the MSCI Korea 25/50 Index during the period commencing April 1, 2021 and ending June 30, 2024, and for three-year testing periods thereafter.
(ii)
In addition to observing the Tender Offer Policy, the Fund’s Board of Directors approved the tender offer in an effort to manage the spread (“discount”) between the market price and the NAV of the Shares, as well as to demonstrate its commitment to continuously review alternative options for narrowing the Fund’s discount in addition to the Fund’s share repurchase program. Also, the Board believes that the Offer may help to reduce what appears to be an oversupply in the market of shares of emerging markets closed-end funds, such as the Fund, which appears to have contributed to relatively wide and persistent trading discounts experienced by these funds.
There can be no assurance that this Offer will reduce or eliminate any discount between the market price and the NAV of the Shares. The market price of the Shares will be determined by, among other things, the relative demand for and supply of Shares in the market, the Fund’s investment performance, the Fund’s dividends and yields, and investor perception of the Fund’s overall attractiveness as an investment as compared with other investment alternatives. Historically, closed-end fund tender offers have resulted in only a temporary reduction in the discount. Nevertheless, the fact that the Offer is being conducted may result in more of a reduction in the discount than might otherwise be the case. Consistent with their fiduciary obligations, in addition to the Offer, the Board of Directors will continue to consider alternative means to reduce or eliminate the Fund’s market value discount from NAV, including through the Fund’s share repurchase program, which has been in place for a number of years. The Fund’s share repurchase program will be suspended during the pendency of the Offer.
Please bear in mind that neither the Fund nor its Board has made any recommendation as to whether or not you should tender your Shares. Stockholders are urged to consult their own investment and tax advisers and make their own decisions whether to tender any Shares and, if so, how many Shares to tender.
What are the most significant conditions of the Offer? (See Section 5, “Certain Conditions of the Offer”)
The Fund will not accept Shares tendered for payment under any one of the following circumstances that, in the view of the Board of Directors, would make it inadvisable to proceed with the Offer, purchase or payment. The following is not a complete list. For a complete list of the conditions of the Offer, please see Section 5, “Certain Conditions of the Offer.”
| · | The Fund would be unable to sell portfolio securities in an orderly manner or such sale would have an adverse effect on the NAV of the Fund to the detriment of those stockholders who do not tender their Shares. |
| · | The Offer could impair compliance with U.S. Securities and Exchange Commission or Internal Revenue Service requirements. |
| · | Trading generally or prices on the NYSE or NASDAQ are suspended or limited. |
| · | The purchase of Shares in the Offer would result in the delisting of the Shares from the NYSE. |
| · | The purchase of Shares in the Offer would result in a failure to comply with the applicable asset coverage requirements applicable to any senior securities of the Fund that are issued and outstanding. |
| · | In the Board of Directors’ judgment, there is a material legal action or proceeding instituted or threatened, challenging the Offer or otherwise potentially materially adversely affecting the Fund. |
| · | Certain circumstances exist beyond the Fund’s control, including limitations imposed by federal or state authorities on the extension of credit by lenders or where banks have suspended payment. |
| · | In the Board of Directors’ judgment, the Fund or its stockholders might be adversely affected if Shares were purchased in the Offer. |
| · | The Board of Directors determines that the purchase of Shares might be a breach of its fiduciary duty. |
If I decide not to tender, how will the Offer affect my Shares? (See Section 10, “Certain Effects of the Offer” and Section 16, “Fees and Expenses”)
If you do not tender your Shares (or if you own Shares following completion of the Offer), you will be subject to any increased risks associated with the reduction in the Fund’s total assets due to the payment for the tendered Shares. These risks may include greater volatility due to a decreased asset base and proportionately higher expenses, as well as the possibility of receiving additional taxable capital gains on the distributions from the sale of portfolio securities to pay for tendered shares. The reduced assets of the Fund as a result of the Offer may result in less investment flexibility for the Fund, depending on the number of Shares repurchased and may have an adverse effect on the Fund’s investment performance.
Whom do I contact if I have questions about the tender offer?
For additional information or assistance, you may call the Information Agent toll-free at (877) 361-7964.
(iii)
THE KOREA FUND, INC.
OFFER TO PURCHASE FOR CASH UP TO 12.5%
OF ITS ISSUED AND OUTSTANDING COMMON SHARES OF
BENEFICIAL INTEREST AT 98.5% OF NET ASSET VALUE PER SHARE
THE OFFER PERIOD WILL BEGIN ON AUGUST 16, 2024
THE OFFER PERIOD AND WITHDRAWAL RIGHTS
WILL EXPIRE AT 5:00 P.M. NEW YORK CITY TIME
ON SEPTEMBER 16, 2024, UNLESS THE OFFER IS EXTENDED.
To the holders of Common Shares of THE KOREA FUND, INC.:
The Korea Fund, Inc., a non-diversified, closed-end management investment company organized as a Maryland corporation (the “Fund”), is offering to purchase up to 12.5%, or 604,144, of its issued and outstanding common shares (“Offer Amount”), with par value of $0.01 per share (“Shares”), for cash at a price (the “Purchase Price”) equal to 98.5% of their net asset value per Share (“NAV”) as of the close of ordinary trading on the New York Stock Exchange (the “NYSE”) on the Expiration Date (as defined below). The offer period and withdrawal rights will expire at 5:00 p.m. New York City time on September 16, 2024 (the “Initial Expiration Date”), unless extended (the Initial Expiration Date or the latest date to which the Offer is extended, the “Expiration Date”), upon the terms and subject to the conditions set forth in this Offer to Purchase and the related Letter of Transmittal (which together constitute the “Offer”). The Shares are currently traded on the NYSE under the ticker symbol “KF.” The NAV on August 12, 2024 was 27.07per Share. You can obtain current NAV quotations from EQ Fund Solutions, the information agent for the Offer (“Information Agent”) at (877) 361-7964. For information on Share price history, see Section 8, “Price Range of Shares.”
The Offer is not conditioned upon the tender of any minimum number of Shares. If the number of Shares properly tendered and not withdrawn prior to the Expiration Date is less than or equal to the Offer Amount, the Fund will, upon the terms and subject to the conditions of the Offer, purchase all Shares tendered. If more Shares than the Offer Amount are properly tendered and not withdrawn prior to the Expiration Date, the Fund will, upon the terms and subject to the conditions of the Offer, purchase the Offer Amount on a pro rata basis. See Section 1, “Price; Number of Shares.”
If, after carefully evaluating all of the information set forth in the Offer, you wish to tender Shares pursuant to the Offer, please either follow the instructions contained in the Offer and Letter of Transmittal or, if your Shares are held of record in the name of a Nominee Holder, contact such firm to effect the tender for you. If you do not wish to tender your Shares, you need not take any action.
(iv)
THIS OFFER IS BEING MADE TO ALL STOCKHOLDERS
OF THE FUND AND IS NOT CONDITIONED UPON ANY
MINIMUM NUMBER OF SHARES BEING TENDERED.
THIS OFFER IS SUBJECT TO CERTAIN CONDITIONS.
SEE SECTION 5, “CERTAIN CONDITIONS OF THE OFFER.”
IMPORTANT
Neither the Fund nor its Board of Directors makes any recommendation to any holder of the Fund’s shares (“Stockholder”) as to whether to tender any or all of such Stockholder’s Shares. Stockholders are urged to evaluate carefully all information in the offer, consult their own investment and tax advisers, and make their own decisions whether to tender Shares and, if so, how many Shares to tender.
No person has been authorized to make any recommendation on behalf of the Fund as to whether Stockholders should tender Shares pursuant to the Offer. No person has been authorized to give any information or to make any representations in connection with the Offer other than those contained herein or in the Letter of Transmittal. If given or made, such recommendation and such information and representations must not be relied upon as having been authorized by the Fund. The Fund has been advised that neither the Fund’s Directors, officers or its investment adviser intend to tender any Shares pursuant to the Offer.
Questions and requests for assistance and requests for additional copies of this Offer to Purchase and Letter of Transmittal should be directed to the Information Agent at the telephone number set forth below.
The Information Agent is:
EQ Fund Solutions
48 Wall Street, 22nd Floor
New York, NY 1005
Tel: (877) 361-7964
The Depositary Agent for the Offer is:
Equiniti Trust Company, LLC
Tel: (877) 248-6417 or (718) 921-8317
| By Registered, Certified or Express Mail or Overnight Courier: | By Mail: | |||
|
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Equiniti Trust Company, LLC |
Equiniti Trust Company, LLC | ||
| 55 Challenger Road |
Operations Center | |||
| Suite # 200 |
P.O. Box 525 | |||
| Ridgefield Park, New Jersey 07660 Attn: Reorganization Department |
Ridgefield Park, New Jersey 07660 Attn: Reorganization Department |
(v)
TABLE OF CONTENTS
| SECTION |
PAGE | |||
| Summary Term Sheet |
(i) | |||
| 1. | Price; Number of Shares |
1 | ||
| 2. | Procedures for Tendering Shares |
1 | ||
| 3. | Withdrawal Rights |
4 | ||
| 4. | Payment for Shares |
4 | ||
| 5. | Certain Conditions of the Offer |
5 | ||
| 6. | Purpose of the Offer |
6 | ||
| 7. | Plans or Proposals of the Fund |
6 | ||
| 8. | Price Range of Shares |
6 | ||
| 9. | Interest of Directors and Executive Officers; Transactions and Arrangements Concerning the Shares |
7 | ||
| 10. | Certain Effects of the Offer |
7 | ||
| 11. | Source and Amount of Funds |
8 | ||
| 12. | Certain Information about the Fund |
9 | ||
| 13. | Additional Information |
9 | ||
| 14. | Certain Federal Income Tax Consequences |
9 | ||
| 15. | Extension of Tender Period; Termination; Amendments |
11 | ||
| 16. | Fees and Expenses |
12 | ||
| 17. | Miscellaneous |
12 | ||
1. PRICE; NUMBER OF SHARES.
The Fund will, upon the terms and subject to the conditions of the Offer, accept for payment (and thereby purchase) up to the Offer Amount of its issued and outstanding Shares or such lesser number as are properly tendered (and not withdrawn in accordance with Section 3, “Withdrawal Rights”). The Fund reserves the right to extend the Offer to a later Expiration Date. See Section 15, “Extension of Tender Period; Termination; Amendments.” The later of the Initial Expiration Date or the latest time and date to which the Offer is extended is hereinafter called the “Expiration Date.” The purchase price of the Shares will be 98.5% of their NAV computed as of the close of ordinary trading on the New York Stock Exchange (“NYSE”) on September 16, 2024 (i.e., the Initial Expiration Date), or if the Offer period is extended, as of the close of ordinary trading on the NYSE on the newly designated Expiration Date. The NAV on August 12, 2024 was $27.07 per Share. You can obtain current NAV quotations from the Information Agent by calling (877) 361-7964. Stockholders tendering Shares shall be entitled to receive all dividends with an “ex date” on or before the Expiration Date provided that they own Shares as of the record date for such dividend.
The Offer is being made to all common Stockholders of the Fund and is not conditioned upon any minimum number of Shares being tendered. If the number of Shares properly tendered and not withdrawn prior to the Expiration Date is less than or equal to the Offer Amount, the Fund will, upon the terms and subject to the conditions of the Offer, purchase all Shares so tendered. If more Shares than the Offer Amount are properly tendered and not withdrawn prior to the Expiration Date, the Fund will purchase the Offer Amount on a pro rata basis. Shares acquired by the Fund pursuant to the Offer will thereafter constitute authorized but unissued shares.
Shares will be purchased at 98.5% of the Fund’s NAV to help defray certain costs of the tender, including the processing of tender forms, effecting payment, postage and handling. The Fund will not charge a separate service fee in conjunction with the offer. If your Shares are held through a financial intermediary, the financial intermediary may charge you a service fee for participation in the offer. Tendering Stockholders will not be obligated to pay transfer taxes on the purchase of Shares by the Fund, except in the circumstances set forth in Section 4, “Payment for Shares.”
On August 12, 2024, there were 4,833,153 Shares issued and outstanding and there were approximately 226 holders of record of Shares. The Fund has been advised that neither its Directors, officers nor investment adviser intend to tender any Shares pursuant to the Offer.
The Fund reserves the right, in its sole discretion, at any time or from time to time, to extend the period of time during which the Offer is open by giving notice of such extension to the Depositary and making a public announcement thereof. See Section 15, “Extension of Tender Period; Termination; Amendments.” The Fund makes no assurance that it will extend the Offer. If the Fund decides, in its sole discretion, to decrease the number of Shares being sought and, at the time that notice of such decrease is first published, sent or given to holders of Shares in the manner specified below, the Expiration Date is less than ten business days away, the Expiration Date will be extended at least ten business days from the date of the notice. During any extension, all Shares previously tendered and not withdrawn will remain subject to the Offer, subject to the right of a tendering Stockholder to withdraw his or her Shares.
2. PROCEDURES FOR TENDERING SHARES.
A. Proper Tender of Shares.
Holders of Shares that are registered in the name of a nominee holder, such as a broker, dealer, commercial bank, trust company or other nominee (“Nominee Holder”) should contact such firm if they desire to tender their Shares.
For Shares to be properly tendered pursuant to the Offer, the following must occur prior to 5:00 p.m. New York City time on the Expiration Date:
| (a) | A properly completed and duly executed Letter of Transmittal, together with any required signature guarantees, (or an Agent’s Message in the case of a book-entry transfer, as described in Section 2.C), and any other documents required by the Letter of Transmittal must be received by the Depositary at its address set forth on page (v) of this Offer; and |
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| (b) | Either the certificates for the Shares must be received by the Depositary at its address set forth on page (v) of this Offer, or the tendering Stockholder must comply with the book-entry delivery procedure set forth in Section 2.C; or |
| (c) | Stockholders must comply with the Guaranteed Delivery Procedure set forth in Section 2.D. |
If the Letter of Transmittal or any certificates or stock powers are signed by directors, executors, administrators, guardians, agents, attorneys-in-fact, officers of corporations or others acting in a fiduciary or representative capacity, such persons should so indicate when signing and must submit proper evidence satisfactory to the Fund of their authority to so act.
Letters of Transmittal and certificates representing Shares, if any, should be sent to the Depositary; they should not be sent or delivered to the Fund.
The Fund’s transfer agent holds Shares in uncertificated form for certain Stockholders pursuant to the Fund’s dividend reinvestment plan. When a Stockholder tenders certificated Shares, the Depositary will accept any of the Stockholder’s uncertificated Shares for tender first, and accept the balance of tendered Shares from the Stockholder’s certificated Shares, and any remaining Shares will be issued in book-entry and will be electronically held in your account in lieu of a certificate.
Section 14(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and Rule 14e-4 promulgated thereunder make it unlawful for any person, acting alone or in concert with others, to tender shares in a partial tender offer for such person’s own account unless at the time of tender, and at the time the shares are accepted for payment, the person tendering has a net long position equal to or greater than the amount tendered in (i) shares, and will deliver or cause to be delivered such shares for the purpose of tender to the person making the offer within the period specified in the offer, or (ii) an equivalent security and, upon acceptance of his or her tender, will acquire shares by conversion, exchange, or exercise of such equivalent security to the extent required by the terms of the offer, and will deliver or cause to be delivered the shares so acquired for the purpose of tender to the fund prior to or on the Expiration Date. Section 14(e) and Rule 14e-4 provide a similar restriction applicable to the tender or guarantee of a tender on behalf of another person.
The acceptance of Shares by the Fund for payment will constitute a binding agreement between the tendering Stockholder and the Fund upon the terms and subject to the conditions of the Offer, including the tendering Stockholder’s representation that (i) such Stockholder has a net long position in the Shares being tendered within the meaning of Rule 14e-4 promulgated under the Exchange Act and (ii) the tender of such Shares complies with Rule 14e-4.
By submitting the Letter of Transmittal, a tendering Stockholder shall, subject to and effective upon acceptance for payment of the Shares tendered, be deemed in consideration of such acceptance to sell, assign and transfer to, or upon the order of, the Fund all right, title and interest in and to all the Shares that are being tendered (and any and all dividends, distributions, other Shares or other securities or rights declared or issuable in respect of such Shares after the Expiration Date) and irrevocably constitute and appoint the Depositary the true and lawful agent and attorney-in-fact of the tendering Stockholder with respect to such Shares (and any such dividends, distributions, other Shares or securities or rights), with full power of substitution (such power of attorney being deemed to be an irrevocable power coupled with an interest) to (a) deliver certificates for such Shares (and any such other dividends, distributions, other Shares or securities or rights) or transfer ownership of such Shares (and any such other dividends, distributions, other Shares or securities or rights), together, in either such case, with all accompanying evidences of transfer and authenticity to or upon the order of the Fund, upon receipt by the Depositary of the purchase price, (b) present such Shares (and any such other dividends, distributions, other Shares or securities or rights) for transfer on the books of the Fund, and (c) receive all benefits and otherwise exercise all rights of beneficial ownership of such Shares (and any such other dividends, distributions, other Shares or securities or rights), all in accordance with the terms of the Offer. Upon such acceptance for payment, all prior powers of attorney given by the tendering Stockholder with respect to such Shares (and any such dividends, distributions, other shares or securities or rights) will, without further action, be revoked and no subsequent powers of attorney may be given by the tendering Stockholder with respect to the tendered Shares (and, if given, will be null and void.)
By submitting a Letter of Transmittal, and in accordance with the terms and conditions of the Offer, a tendering Stockholder shall be deemed to represent and warrant that: (a) the tendering Stockholder has full power and authority to tender, sell, assign and transfer the tendered Shares (and any and all dividends, distributions, other Shares or other securities or rights declared or issuable in respect of such Shares after the Expiration Date); (b) when and to the extent the Fund accepts the Shares for purchase, the Fund will acquire good, marketable and unencumbered title thereto, free and clear of all liens, restrictions, charges, proxies, encumbrances or other obligations relating to their sale or transfer, and not subject to any adverse claim; (c) on request, the tendering Stockholder will execute and deliver any additional documents deemed by the Depositary or the Fund to be necessary or desirable to complete the sale, assignment and transfer of the tendered Shares (and any and all dividends, distributions, other Shares or securities or rights declared or issuable in respect of such Shares after the Expiration Date); and (d) the tendering Stockholder has read and agreed to all of the terms of the Offer, including this Offer to Purchase and the Letter of Transmittal.
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B. Signature Guarantees and Method of Delivery.
Signatures on the Letter of Transmittal are required to be guaranteed if any tendered stock certificates are registered in a name other than that of the tendering Stockholder or if a check for cash is to be issued in a name other than that of the registered owner of such Shares. In those instances, all signatures on the Letter of Transmittal must be guaranteed by an eligible guarantor acceptable to the Depositary (an “Eligible Guarantor”). An eligible guarantor includes a bank, broker, dealer, credit union, savings association or other entity that is a member in good standing of the Securities Transfer Agents Medallion Program (“STAMP”), or a bank, broker, dealer, credit union, savings association or other entity that is an “Eligible Guarantor Institution” as such term is defined in Rule 17Ad-15 under the Exchange Act. If Shares are tendered for the account of an institution that qualifies as an Eligible Guarantor, signatures on the Letter of Transmittal are not required to be guaranteed. If the Letter of Transmittal is signed by a person or persons authorized to sign on behalf of the registered owner(s), then the Letter of Transmittal must be accompanied by documents evidencing such authority to sign to the satisfaction of the Fund.
THE METHOD OF DELIVERY OF ANY DOCUMENTS, INCLUDING CERTIFICATES FOR SHARES, IS AT THE ELECTION AND RISK OF THE PARTY TENDERING SHARES. IF DOCUMENTS ARE SENT BY MAIL, IT IS RECOMMENDED THAT THEY BE SENT BY REGISTERED MAIL, PROPERLY INSURED, WITH RETURN RECEIPT REQUESTED.
C. Book-Entry Delivery Procedure.
The Depositary will establish accounts with respect to the Shares at The Depository Trust Company (“DTC”) for purposes of the Offer by August 20, 2024. Any financial institution that is a participant in any of DTC’s systems may make delivery of tendered Shares by (i) causing DTC to transfer such Shares into the Depositary’s account in accordance with DTC’s procedure for such transfer; and (ii) causing a confirmation of receipt of such delivery to be received by the Depositary. DTC may charge the account of such financial institution for tendering Shares on behalf of Stockholders. Notwithstanding that delivery of Shares may be properly effected in accordance with this book-entry delivery procedure, the Letter of Transmittal, with signature guarantee, if required, or, in lieu of the Letter of Transmittal, an Agent’s Message (as defined below) in connection with a book-entry transfer, must be transmitted to and received by the Depositary at the appropriate address set forth on page (v) of this Offer to Purchase before 5:00 p.m. New York City time on the Expiration Date.
The term “Agent’s Message” means a message from DTC transmitted to, and received by, the Depositary forming a part of a timely confirmation of a book-entry transfer (a “Book-Entry Confirmation”), which states that DTC has received an express acknowledgment from the DTC participant (“DTC Participant”) tendering the Shares that are the subject of the Book-Entry Confirmation that (i) the DTC Participant has received and agrees to be bound by the terms of the Letter of Transmittal; and (ii) the Fund may enforce such agreement against the DTC Participant.
DELIVERY OF DOCUMENTS TO DTC IN ACCORDANCE WITH DTC’S PROCEDURES DOES NOT CONSTITUTE DELIVERY TO THE DEPOSITARY FOR PURPOSES OF THIS OFFER.
D. Guaranteed Delivery Procedure.
If your certificates for Shares, if any, are not immediately available or time will not permit the Letter of Transmittal and other required documents to reach the Depositary prior to the Expiration Date, you may properly tender Shares if the following three conditions are met:
| (i) | You make such tenders by or through an Eligible Guarantor; |
| (ii) | The Depositary receives, prior to 5:00 p.m. New York City time on the Expiration Date, a properly completed and duly executed Notice of Guaranteed Delivery substantially in the form provided by the Fund (delivered by mail, telegram, telex or facsimile transmission); and |
| (iii) | The certificates for all tendered Shares, or a Book-Entry Confirmation, together with a properly completed and duly executed Letter of Transmittal (or, in the case of a book-entry transfer, an Agent’s Message in lieu of the Letter of Transmittal), and any other documents required by the Letter of Transmittal, are received by the Depositary within one NYSE trading day after the execution date of the Notice of Guaranteed Delivery. |
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E. Determination of Validity.
All questions as to the validity, form, eligibility (including time of receipt) and acceptance of tenders will be determined by the Fund, in its sole discretion, whose determination shall be final and binding. The Fund reserves the absolute right to reject any or all tenders determined by it not to be in appropriate form or good order, or the acceptance of or payment for which may, in the opinion of the Fund’s counsel, be unlawful. The Fund also reserves the absolute right to waive any of the conditions of the Offer or any defect in any tender with respect to any particular Shares or any particular stockholder, and the Fund’s interpretations of the terms and conditions of the Offer will be final and binding. Unless waived, any defects or irregularities in connection with tenders must be cured within such times as the Fund shall determine. Tendered Shares will not be accepted for payment unless any defects or irregularities have been cured or waived within such time. Neither the Fund, the Depositary nor any other person shall be obligated to give notice of any defects or irregularities in tenders, nor shall any of them incur any liability for failure to give such notice.
F. Federal Income Tax Withholding.
Payments made to tendering Stockholders pursuant to the Offer may be subject to withholding pursuant to the Internal Revenue Code of 1986, as amended (the “Code”) and the regulations thereunder. For an additional discussion of such withholding as well as a discussion of certain other U.S. federal income tax consequences to tendering and non-tendering Stockholders, see Section 14, “Certain U.S. Federal Income Tax Consequences.”
3. WITHDRAWAL RIGHTS.
Except as otherwise provided in this Section 3, tenders of Shares made pursuant to the Offer will be irrevocable. You have the right to withdraw tendered Shares at any time prior to 5:00 p.m. New York City time on the Expiration Date. If you desire to withdraw Shares tendered on your behalf by a Nominee Holder, you may withdraw by contacting that firm and instructing them to withdraw such Shares. Upon terms and subject to the conditions of the Offer, the Fund expects to accept for payment properly tendered Shares promptly after the Expiration Date. You may not withdraw your shares after 5:00 p.m. New York City time, on September 16, 2024 through October 15, 2024. If the Fund has not yet accepted tendered Shares for payment by October 15, 2024, you may withdraw your tendered Shares.
To be effective, a written or facsimile transmission notice of withdrawal must be timely received by the Depositary at the address set forth on page (v) of this Offer. Any notice of withdrawal must specify the name of the person who deposited the Shares to be withdrawn, the number of Shares to be withdrawn, and the names in which the Shares to be withdrawn are registered. Stockholders should contact the Information Agent for instructions if they wish to submit a notice of withdrawal.
If certificates have been delivered to the Depositary, the name of the registered holder and the serial numbers of the particular certificates evidencing the Shares withdrawn must also be furnished to the Depositary and the signature on the notice of withdrawal must be guaranteed by an Eligible Guarantor. If Shares have been delivered pursuant to the book-entry delivery procedure (set forth in Section 2, “Procedures for Tendering Shares”), any notice of withdrawal must specify the name and number of the account at the book-entry transfer facility to be credited with the withdrawn Shares (which must be the same name, number, and book-entry transfer facility from which the Shares were tendered), and must comply with the procedures of DTC.
All questions as to the form and validity (including time of receipt) of notices of withdrawal will be determined by the Fund in its sole discretion, whose determination shall be final and binding. Neither the Fund, the Depositary nor any other person is or will be obligated to give any notice of any defects or irregularities in any notice of withdrawal, and none of them will incur any liability for failure to give any such notice. Shares properly withdrawn shall not thereafter be deemed to be tendered for purposes of the Offer. However, withdrawn Shares may be retendered by following the procedures described in Section 2, “Procedures for Tendering Shares,” prior to 5:00 p.m. New York City time on the Expiration Date.
4. PAYMENT FOR SHARES.
For purposes of the Offer, the Fund will be deemed to have accepted for payment (and thereby purchased) Shares that are tendered and not withdrawn when, as and if, it gives oral or written notice to the Depositary of its acceptance of such Shares for payment pursuant to the Offer. Upon the terms and subject to the conditions of the Offer, the Fund will, promptly after the Expiration Date, accept for payment (and thereby purchase) Shares properly tendered prior to 5:00 p.m. New York City time on the Expiration Date.
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Payment for Shares accepted for payment pursuant to the Offer will be made by the Depositary out of funds made available to it by the Fund. The Depositary will act as agent for the Fund for the purpose of effecting payment to the tendering Stockholders. In all cases, payment for Shares tendered and accepted for payment pursuant to the Offer will be made only after timely receipt by the Depositary of (i) Share certificates evidencing such Shares or a Book-Entry Confirmation of the delivery of such Shares, (ii) a properly completed and duly executed Letter of Transmittal or, in the case of a book-entry transfer, an Agent’s Message in lieu of the Letter of Transmittal, and (iii) any other documents required by the Letter of Transmittal. Accordingly, payment may not be made to all tendering Stockholders at the same time and will depend upon when Share certificates are received by the Depositary or Book-Entry Confirmations of tendered Shares are received in the Depositary’s account at DTC.
If any tendered Shares are not accepted for payment or are not paid because of an invalid tender, if certificates are submitted for more Shares than are tendered, or if a Stockholder withdraws tendered Shares, (i) the shares will be issued in book-entry form and will be electronically held in your account for such unpurchased Shares, as soon as practicable following the expiration, termination or withdrawal of the Offer, (ii) Shares delivered pursuant to the book-entry delivery procedures will be credited to the account from which they were delivered, and (iii) uncertificated Shares held by the Fund’s transfer agent pursuant to the Fund’s dividend reinvestment plan will be returned to the dividend reinvestment plan account maintained by the transfer agent.
The Fund will pay all transfer taxes, if any, payable on the transfer to it of Shares purchased pursuant to the Offer. If, however, payment of the purchase price is to be made to, or if unpurchased Shares were registered in the name of, any person other than the tendering holder, or if any tendered certificates are registered or the Shares tendered are held in the name of any person other than the person signing the Letter of Transmittal, the amount of any transfer taxes (whether imposed on the registered holder or such other person) payable on account of such transfer will be deducted from the purchase price unless satisfactory evidence of the payment of such taxes, or exemption therefrom, is submitted. In addition, if certain events occur, the Fund may not be obligated to purchase Shares pursuant to the Offer. See, Section 5, “Certain Conditions of the Offer.”
A tendering U.S. Stockholder or other payee who fails to fully complete and sign the Substitute IRS Form W-9 may be subject to U.S. federal income backup withholding on the gross proceeds paid to such Stockholder or other payee pursuant to the Offer. Non-U.S. Stockholders should provide the Depositary with an appropriate completed IRS Form W-8BEN or Form W-8BEN-E in order to avoid backup withholding. A copy of IRS Form W-9, W-8BEN or W-8BEN-E will be provided upon request from the Depositary. See, Section 2, “Procedures for Tendering Shares” and Section 14, “Certain Federal Income Tax Consequences.”
5. CERTAIN CONDITIONS OF THE OFFER.
Notwithstanding any other provision of the Offer, the Fund will not accept Shares tendered for payment that, in the view of the Board of Directors would make it inadvisable to proceed with the offer, purchase or payment. This may occur in the following circumstances: (1) such transactions, if consummated, would (a) result in delisting of the Fund’s Shares from the NYSE (the NYSE Listed Company Manual provides that the NYSE would promptly initiate suspension and delisting procedures with respect to closed-end funds if the average global market capitalization of the entity over thirty consecutive trading days is below $50,000,000); (b) cause the Fund to fail to qualify and to be treated as a regulated investment company under the Code (which would subject the Fund to tax on its taxable income at corporate rates, and cause all distributions from earnings and profits, including any distributions of net tax-exempt income and net long-term capital gains, to be taxable to Stockholders as ordinary income); or (c) result in a failure to comply with the applicable asset coverage requirements applicable to any senior securities of the Fund that are issued and outstanding; (2) the amount of Shares tendered would require liquidation of such a substantial portion of the Fund’s portfolio securities that the Fund would not be able to liquidate portfolio securities in an orderly manner in light of the existing market conditions and such liquidation would have an adverse effect on the NAV of the Fund to the detriment of non-tendering Stockholders; (3) there is any (a) in the Board of Directors’ judgment, material legal action or proceeding instituted or threatened challenging such transactions or otherwise materially adversely affecting the Fund; (b) suspension of or limitation on prices for trading securities generally on the NYSE or other national securities exchange(s), or the National Association of Securities Dealers Automated Quotation System (“NASDAQ”) National Market System; (c) declaration of a banking moratorium by Federal or state authorities or any suspension of payment by banks in the United States or New York State; (d) limitation affecting the Fund or the issuers of its portfolio securities imposed by federal or state authorities on the extension of credit by lending institutions; (e) commencement of war, armed hostilities or other international or national calamity directly or indirectly involving the United States; or (f) in the Board of Directors’ judgment, other event or condition which would have a material adverse effect on the Fund or its Stockholders if tendered Shares were purchased; or (4) the Board of Directors determines that effecting any such transaction would constitute a breach of their fiduciary duty owed to the Fund or its Stockholders. The Board of Directors may modify these conditions in light of experience.
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The Fund reserves the right, at any time during the pendency of the Offer, to terminate, extend or amend the Offer in any respect. If the Fund determines to terminate or amend the Offer or to postpone the acceptance for payment of or payment for Shares tendered, it will, to the extent necessary, extend the period of time during which the Offer is open as provided in Section 15, “Extension of Tender Period; Termination; Amendments.” In the event any of the foregoing conditions are modified or waived in whole or in part at any time, the Fund will promptly make a public announcement of such waiver and may, depending on the materiality of the modification or waiver, extend the Offer period as provided in Section 15, “Extension of Tender Period; Termination; Amendments.”
6. PURPOSE OF THE OFFER.
This tender offer is being conducted as a result of a policy (the “Tender Offer Policy”) adopted by the Fund’s Board of Directors in December 2020. Pursuant to the Tender Offer Policy, the Board will cause the Fund to conduct an issuer tender offer for up to twenty-five percent (25%) of its then issued and outstanding shares of common stock on or before September 30, 2024, and thereafter on each third year anniversary of September 30, 2024, if the Fund’s total return investment performance measured on a NAV basis does not equal or exceed the total return investment performance of the MSCI Korea 25/50 Index during the period commencing April 1, 2021 and ending June 30, 2024, and for three-year testing periods thereafter.
In addition to observing the Tender Offer Policy, the Fund’s Board of Directors approved the tender offer in an effort to manage the spread (“discount”) between the market price and the NAV of the Shares, as well as to demonstrate its commitment to continuously review alternative options for narrowing the Fund’s discount in addition to the Fund’s share repurchase program. Also, the Board believes that the Offer may help to reduce what appears to be an oversupply in the market of shares of emerging markets closed-end funds, such as the Fund, which appears to have contributed to relatively wide and persistent trading discounts experienced by these funds. The Board also considered that, by conducting the Offer at 98.5% of the NAV of the Shares, the purchase of Shares tendered would be somewhat accretive to the NAV of Shares that remain outstanding immediately following the Offer, although the Fund’s total net assets will decrease, which may result in greater volatility, less investment flexibility and proportionately higher expenses for the Fund following the Offer.
There can be no assurance that this Offer will reduce or eliminate any discount between the market price and the NAV of the Shares. The market price of the Shares will be determined by, among other things, the relative demand for and supply of Shares in the market, the Fund’s investment performance, the Fund’s dividends and yields, and investor perception of the Fund’s overall attractiveness as an investment as compared with other investment alternatives. Historically, closed-end fund tender offers have resulted in only a temporary reduction in the discount. Nevertheless, the fact that the Offer is being conducted may result in more of a reduction in the discount than might otherwise be the case. Consistent with their fiduciary obligations, in addition to the Offer, the Board of Directors will continue to consider alternative means to reduce or eliminate the Fund’s market value discount from NAV, including through the Fund’s share repurchase program, which has been in place for a number of years. The share repurchase program will be suspended during the pendency of the Offer.
NEITHER THE FUND NOR ITS BOARD OF DIRECTORS MAKES ANY RECOMMENDATION TO ANY STOCKHOLDER AS TO WHETHER TO TENDER OR REFRAIN FROM TENDERING ANY OR ALL OF SUCH STOCKHOLDER’S SHARES AND HAS NOT AUTHORIZED ANY PERSON TO MAKE ANY SUCH RECOMMENDATION. STOCKHOLDERS ARE URGED TO EVALUATE CAREFULLY ALL INFORMATION IN THE OFFER, CONSULT THEIR OWN INVESTMENT AND TAX ADVISERS, AND MAKE THEIR OWN DECISIONS WHETHER TO TENDER SHARES AND, IF SO, HOW MANY SHARES TO TENDER.
7. PLANS OR PROPOSALS OF THE FUND.
The Fund has no present plans or proposals, and is not engaged in any negotiations, that relate to or would result in: any extraordinary corporate transaction, such as a merger, reorganization or liquidation involving the Fund; any purchase, sale or transfer of a material amount of assets of the Fund (other than in its ordinary course of business); any material changes in the Fund’s present capitalization (except as resulting from the Offer or otherwise set forth herein); or any other material changes in the Fund’s structure or business.
8. PRICE RANGE OF SHARES.
The Shares are traded on the NYSE. During each completed fiscal quarter for the 24-month period beginning July 1, 2022, the highest and lowest Market Price per Share, and period-end Market Price per Share (as of the close of ordinary trading on the NYSE on the last day of such periods) were as follows:
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| Fiscal Quarter Ended |
Market Price ($) | |||||||||
| High | Low | Close | ||||||||
| September 30, 2022 |
$ 26.3300 | $ | 19.2101 | $ | 19.2101 | |||||
| December 31, 2022 |
$ 25.0100 | $ | 19.2101 | $ | 20.8300 | |||||
| March 31, 2023 |
$ 24.7300 | $ | 20.6500 | $ | 21.9677 | |||||
| June 30, 2023 |
$ 24.6200 | $ | 20.6700 | $ | 23.1400 | |||||
| September 30, 2023 |
$ 24.1900 | $ | 20.6200 | $ | 21.0300 | |||||
| December 31, 2023 |
$ 23.6360 | $ | 18.3500 | $ | 23.4000 | |||||
| March 31, 2024 |
$ 25.4300 | $ | 20.7200 | $ | 25.4300 | |||||
| June 30, 2024 |
$ 25.2800 | $ | 22.9800 | $ | 24.1300 | |||||
The Fund commenced operations on August 22, 1984 as an NYSE-listed company. The Fund pays dividends annually.
9. INTEREST OF DIRECTORS AND EXECUTIVE OFFICERS; TRANSACTIONS AND ARRANGEMENTS CONCERNING THE SHARES.
The members of the Board of Directors of the Fund are: Julian M. I. Reid, Richard A. Silver, Matthew J. Sippel and Madam Yan Hu, each of whom is not an “interested person” of the Fund, as that term is defined in the Investment Company Act of 1940 (the “1940 Act”) (the “Independent Board Members”).
The executive officers of the Fund are Simon J. Crinage, President and Chief Executive Officer, Neil S. Martin, Treasurer, Principal Financial and Accounting Officer, Paul F. Winship, Vice President and Secretary, Carmine Lekstutis, Chief Legal Officer and Stephen M. Ungerman, Chief Compliance Officer. Correspondence to the Directors and executive officers of the Fund should be mailed to The Korea Fund, Inc., c/o JPMorgan Funds Limited60 Victoria Embankment, London, EC4Y 0JP, Attn: Paul Winship / Secretary.
Based upon the Fund’s records and upon information provided to the Fund by its Directors, executive officers and associates (as such term is used in Rule 12b-2 under the Exchange Act), as of August 12, 2024, the Directors and executive officers of the Fund, as a group beneficially owned less than 1% of the outstanding Shares of the Fund. The Fund has been informed that no Director or executive officer of the Fund intends to tender any Shares pursuant to the Offer.
Based upon the Fund’s records and upon information provided to the Fund by its Directors, executive officers and associates (as such term is used in Rule 12b-2 under the Exchange Act), neither the Fund nor, to the best of the Fund’s knowledge, any of the Directors or executive officers of the Fund, nor any associates (as such term is used in Rule 12b-2 under the Exchange Act) of any of the foregoing, has effected any transactions in Shares during the sixty day period prior to the date hereof.
Except as set forth in this Offer to Purchase, neither the Fund nor, to the best of the Fund’s knowledge, any of its affiliates, Directors or executive officers, is a party to any contract, arrangement, understanding or relationship with any other person relating, directly or indirectly, to the Offer with respect to any Shares (including, but not limited to, any contract, arrangement, understanding or relationship concerning the transfer or the voting of any Shares, joint ventures, loan or option arrangements, puts or calls, guaranties of loans, guaranties against loss or the giving or withholding of proxies, consents or authorizations).
10. CERTAIN EFFECTS OF THE OFFER.
Effect on NAV and Consideration Received by Tendering Stockholders. To pay the aggregate purchase price of Shares accepted for payment pursuant to the Offer, the Fund anticipates that funds will be first derived from any cash on hand and then from the proceeds from the sale of portfolio securities held by the Fund. If the Fund is required to sell a substantial amount of portfolio securities to raise cash to finance the Offer, the over-supply of portfolio securities for sale could cause market prices of the Fund’s portfolio securities, and hence the Fund’s NAV, to decline. If such a decline occurs, the Fund cannot predict what its magnitude might be or whether such a decline would be temporary or continue to or beyond the Expiration Date. Because the price per Share to be paid in the Offer will be dependent upon the NAV as determined as of the close of ordinary trading on the NYSE on the Expiration Date, if such a decline continued to the Expiration Date, the consideration received by tendering Stockholders would be less than it otherwise might be. In addition, a sale of portfolio securities will cause increased brokerage and related transaction expenses, and the Fund may receive proceeds from the sale of portfolio securities that are less than the valuations of such securities by the Fund. Accordingly, because of
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the Offer, the Fund’s NAV may decline more than it otherwise might, thereby reducing the amount of proceeds received by tendering Stockholders, and also reducing the NAV for non-tendering Stockholders. However, because the Offer price is for 98.5% of the NAV of the Shares, the purchase of Shares tendered in and of itself would be somewhat accretive to the NAV.
The Fund may well sell portfolio securities during the pendency of the Offer to raise cash for the purchase of Shares. Thus, it is likely that during the pendency of the Offer, and possibly for a short time thereafter, the Fund will hold a greater than normal percentage of its net assets in cash and cash equivalents. This larger cash position may interfere with the Fund’s ability to meet its investment objective. The Fund is required by law to pay for tendered Shares it accepts for payment promptly after the Expiration Date of this Offer. If on or prior to the Expiration Date, the Fund does not have, or believes it is unlikely to have, sufficient cash to pay for all Shares tendered, it may extend the Offer to allow additional time to sell portfolio securities and raise sufficient cash.
Recognition of Capital Gains. As noted above, the Fund may well be required to sell portfolio securities in order to raise cash to meet purchase requests pursuant to the Offer. The actual tax effect of such sales will depend on the difference between the price at which such portfolio securities are sold and the tax basis of the Fund in such securities. Any capital gains recognized in any such sales on a net basis, after reduction by any available capital losses, will be distributed to Stockholders as capital gain dividends (to the extent of net realized long-term capital gains over net realized short-term capital losses) or ordinary dividends (to the extent of net realized short-term capital gains over net realized long-term capital losses) during or with respect to the year of sale, and such distributions will be taxable to Stockholders. Any such sales (1) could require Stockholders that hold Shares at the time of a declaration of distributions to pay taxes on greater distributions of capital gains recognized by the Fund than they otherwise would have absent such sales; and (2) could require the Fund to sell additional portfolio securities in order to raise cash to make such additional distributions, thereby, requiring the Fund, in turn, to realize and recognize additional capital gains.
It is impossible to predict the amount of unrealized gains or losses in the Fund’s portfolio securities at the time that the Fund is required to sell such portfolio securities, and hence the amount of capital gains or losses that would be realized and recognized. As of August 12, 2024, the Fund had unrealized gains of $26,122,766.74, net realized gains for the current year of $1,386,097.98, and estimated capital loss carryforwards of $14,442,726 as of its June 30, 2024 fiscal year end.
Tax Consequences of Repurchases to Stockholders. The Fund’s purchase of Shares tendered pursuant to the Offer will have tax consequences for tendering Stockholders and may also have tax consequences for non-tendering Stockholders. See, Section 14 “Certain U.S. Federal Income Tax Consequences.”
Effect on Remaining Stockholders, Higher Expense Ratio and Less Investment Flexibility. The purchase of Shares by the Fund pursuant to the Offer will have the effect of increasing the proportionate interest in the Fund of non-tendering Stockholders. All Stockholders remaining after the Offer will be subject to any increased risks associated with the reduction in the Fund’s aggregate assets resulting from payment for the tendered Shares, such as greater volatility due to decreased diversification and proportionately higher expenses. The reduced net assets of the Fund as a result of the Offer may result in less investment flexibility for the Fund, depending on the number of Shares repurchased, and may have an adverse effect on the Fund’s investment performance.
Possible Proration. If greater than 12.5% of the Fund’s Shares are tendered pursuant to the Offer, the Fund would, upon the terms and subject to the conditions of the Offer, purchase Shares tendered on a pro rata basis. Accordingly, Stockholders cannot be assured that all of their tendered Shares will be repurchased.
THE OFFER MAY HAVE CERTAIN ADVERSE CONSEQUENCES FOR TENDERING AND NON-TENDERING STOCKHOLDERS.
11. SOURCE AND AMOUNT OF FUNDS.
The actual cost to the Fund of purchasing Shares from the Offer cannot be determined at this time because the number of Shares to be purchased will depend on the number tendered, and the price will be 98.5% of the NAV on the Expiration Date. If the NAV on that date were the same as the NAV per Share on August 12, 2024, and if 12.5% of the outstanding Shares are purchased pursuant to the Offer, the estimated cost to the Fund, not including fees and expenses incurred in connection with the Offer, would be approximately $16,108,865.
The monies to be used by the Fund to purchase Shares pursuant to the Offer will be first obtained from any cash on hand and then from proceeds of sales of securities in the Fund’s investment portfolio.
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The Board of Directors believes that the Fund has sufficient liquidity to purchase the Shares that may be tendered pursuant to the Offer. However, if, in the judgment of the Board of Directors, there is not sufficient liquidity of the assets of the Fund to pay for tendered Shares, the Fund may terminate the Offer. See Section 5, “Certain Conditions of the Offer.” The Fund will not borrow money or undertake any other alternative arrangements to finance the purchase of tendered Shares.
12. CERTAIN INFORMATION ABOUT THE FUND.
The Fund was organized as a Maryland corporation on May 11, 1984 and is a non-diversified closed-end management investment company registered under the 1940 Act. The Shares were first issued to the public on August 22, 1984. As a closed-end investment company, the Fund differs from an open-end investment company (i.e., a mutual fund) in that it does not redeem its Shares at the election of a Stockholder and does not continuously offer its Shares for sale to the public. The Fund is listed on the NYSE.
The Fund’s investment objective is to seek long-term capital appreciation through investment in securities, primarily equity securities, of Korean companies.
The principal executive offices of the Fund are located at 60 Victoria Embankment, London, EC4Y 0JP.
13. ADDITIONAL INFORMATION.
The Fund is subject to the information and reporting requirements of the 1940 Act and in accordance therewith is obligated to file reports and other information with the U.S. Securities and Exchange Commission (the “Commission”) relating to its business, financial condition and other matters. The Fund has also filed an Issuer Tender Offer Statement on Schedule TO with the Commission. Such reports and other information are available for inspection at the public reference room at the Commission’s office, 100 F Street, N.E., Washington, D.C. 20549. Copies may be obtained, by mail, upon payment of the Commission’s customary charges, by writing to its principal office at 100 F Street, N.E., Washington, D.C. 20549. Such reports and other information are also available on the Commission’s website (www.sec.gov).
14. CERTAIN U.S. FEDERAL INCOME TAX CONSEQUENCES.
The following discussion is a general summary of the U.S. federal income tax consequences of the purchase of Shares by the Fund from shareholders pursuant to the Offer. This summary is based on U.S. federal income tax law as of the date the Offer begins, including the Internal Revenue Code of 1986, as amended (the “Code”), applicable Treasury regulations, Internal Revenue Service (“IRS”) rulings, judicial authority and current administrative rulings and practice, all of which are subject to change, possibly with retroactive effect. There can be no assurance that the IRS would not assert, or that a court would not sustain, a position contrary to any of those set forth below, and the Fund has not obtained, nor does the Fund intend to obtain, a ruling from the IRS or an opinion of counsel with respect to any of the consequences described below. Shareholders should also consult their own tax advisers regarding their particular situation and the potential tax consequences to them of a purchase of their Shares by the Fund pursuant to the Offer, including potential state, local and foreign taxation, as well as any applicable transfer taxes.
As used herein, the term “U.S. Shareholder” refers to a shareholder who is (i) a citizen or resident of the United States, (ii) a corporation, partnership or other entity created or organized in or under the laws of the United States or any State thereof or the District of Columbia, (iii) an estate the income of which is subject to U.S. federal income tax regardless of the source of such income, and (iv) a trust if a court within the United States is able to exercise primary supervision over the administration of the trust and one or more U.S. persons (as defined in the Code) have the authority to control all substantial decisions of the trust. The term “Non-U.S. Shareholder” refers to a shareholder who is not a U.S. Shareholder.
Sale or Exchange of Shares. A shareholder (other than a tax-exempt shareholder) whose Shares are repurchased pursuant to the Offer generally will be treated as having sold the Shares and will recognize gain or loss for U.S. federal income tax purposes, so long as either (a) such shareholder tenders, and the Fund repurchases, all of such shareholder’s Shares (i.e., the shareholder reduces its percentage ownership of the Fund to 0%) or meets certain numerical safe harbors with respect to percentage voting interest and reduction in ownership of the Fund following the completion of the Offer, or (b) the tender otherwise is treated as being “not essentially equivalent to a dividend” under the relevant rules of the Code. For these purposes, a shareholder’s ownership of the Fund is determined after applying the ownership attribution rules under Section 318 of the Code. Such gain or loss will equal the difference between the price paid by the Fund for the Shares pursuant to the Offer and the shareholder’s adjusted tax basis in the Shares sold. A shareholder’s holding period in Shares repurchased pursuant to the Offer will terminate as of the Expiration Date. A tendering
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shareholder’s gain or loss will generally be capital gain or loss if the Shares sold are held by the shareholder at the time of sale as capital assets and will be treated as long-term if the Shares have been held for more than one year or as short-term if the Shares have been held for one year or less. To the extent that a portion of any such gain is treated as interest, that portion will be taxed to the shareholder as ordinary income. It is expected that, if a shareholder is treated as having sold Shares pursuant to the Offer and realizes a gain upon such sale, and if one or more payments are received after the close of the taxable year of the shareholder in which the Expiration Date occurs, unless the shareholder elects otherwise, the gain will be accounted for under the installment sale rules for U.S. federal income tax purposes and the shareholder will generally recognize any such gain as and when proceeds are received, likely allocating tax basis according to the presumed percentage of the total payment received in each installment.
The maximum U.S. federal income tax rate applicable to short-term capital gains recognized by a non-corporate Shareholder is currently the same as the applicable ordinary income rate. In addition, the Code generally imposes a 3.8% Medicare contribution tax on the net investment income of certain individuals, estates and trusts to the extent their income exceeds certain threshold amounts. For these purposes, “net investment income” generally includes, among other things, (i) distributions paid by the Fund of net investment income and capital gains, and (ii) any net gain from the sale, exchange or other taxable disposition of Fund Shares.
In the event that a tendering shareholder’s ownership of the Fund is not reduced to the extent required under the tests described above, such shareholder will be deemed to receive a distribution from the Fund under Section 301 of the Code with respect to the Shares held (or deemed held under Section 318 of the Code) by the shareholder after the tender (a “Section 301 distribution”). Such distribution, which will equal the price paid by the Fund to such shareholder for the Shares sold, and will be taxable as a dividend to the extent of the Fund’s current and accumulated earnings and profits allocable to such distribution, with the excess treated as a return of capital reducing the shareholder’s tax basis in the Shares held (or deemed held under Section 318 of the Code) after the Offer, and thereafter as capital gain. In the case of a tendering shareholder that is a corporation treated as receiving a Section 301 distribution from the Fund in connection with the transaction, special basis adjustments might also apply with respect to any Shares of such shareholder not repurchased in connection with the Offer. To the extent any Section 301 distribution is reported by the Fund as derived from “qualified dividend income,” it will be taxed in the hands of individual shareholders at the rates applicable to net capital gains, provided holding period and other requirements are met at both the shareholder and Fund level. Similarly, if a portion of the Fund’s income for the taxable year in which a deemed Section 301 distribution is paid (see below) consists of qualifying dividends paid by U.S. corporations and is properly reported by the Fund, such portion might qualify for the dividends received deduction when received by corporate shareholders, provided holding period and other requirements are met at both the shareholder and Fund level.
Provided that no tendering shareholder is treated as receiving a Section 301 distribution as a result of the Offer, shareholders whose percentage ownership of the Fund increases as a result of the Offer will not be treated as realizing constructive distributions by virtue of that increase. In the event that any tendering shareholder is deemed to receive a Section 301 distribution as a result of the Offer, it is possible that shareholders whose percentage ownership of the Fund increases as a result of the Offer, including shareholders who do not tender any Shares pursuant to the Offer, will be deemed to receive a constructive distribution under Section 305(c) of the Code in an amount determined by the increase in their percentage ownership of the Fund as a result of the Offer. Such constructive distribution will be treated as a dividend to the extent of current or accumulated earnings and profits allocable to it. Such dividend treatment will not apply, however, if the tender is treated as an “isolated redemption” within the meaning of the Treasury regulations.
Under the “wash sale” rules under the Code, provided the tender of Shares pursuant to the Offer is treated as a sale or exchange (and not a distribution as described above), loss recognized on Shares sold pursuant to the Offer will ordinarily be disallowed to the extent the shareholder acquires other shares of the Fund (whether through automatic reinvestment of dividends or otherwise) or substantially identical stock or securities within 30 days before or after the date the tendered Shares are purchased pursuant to the Offer and, in that event, the basis and holding period of the shares acquired will be adjusted to reflect the disallowed loss. Any loss realized by a shareholder on the sale of a Share held by the shareholder for six months or less will be treated for U.S. federal income tax purposes as a long-term capital loss to the extent of any distributions or deemed distributions of long-term capital gains received by the shareholder with respect to such Share. A shareholder’s ability to use capital losses may be limited under the Code.
Non-U.S. Shareholders. Provided the sale of Shares pursuant to the Offer is respected as a sale or exchange for U.S. federal income tax purposes, any gain realized by a Non-U.S. Shareholder upon the tender of Shares pursuant to the Offer will generally not be subject to any U.S. tax withholding and, provided such gain is not effectively connected with a trade or business carried on in the U.S. by such Non-U.S. Shareholder, will not be subject to any U.S. federal income tax. If, instead, all or a portion of the proceeds received by a tendering Non-U.S. Shareholder is treated for U.S. federal income tax purposes as a Section 301 distribution by the Fund that is treated in whole or in part as a dividend, or if a Non-U.S. Shareholder is otherwise treated as receiving a deemed distribution that is a dividend by reason of the shareholder’s increase in its percentage ownership of the Fund resulting from other
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shareholders’ sale of Shares pursuant to the Offer, absent a statutory exemption, the dividend received or deemed received by the Non-U.S. Shareholder will be subject to a U.S. withholding tax at the rate of 30% (or such lower rate as may be applicable under a tax treaty). If any gain or dividend income realized in connection with the tender of Shares by a Non-U.S. Shareholder is effectively connected with a trade or business carried on in the U.S. by the Non-U.S. Shareholder, such gain or dividend will be taxed at the graduated rates applicable to U.S. Shareholders. In addition, if the Non-U.S. Shareholder is a non-U.S. corporation, it may be subject to 30% (or such lower rate as may be applicable under a tax treaty) branch profits tax on such effectively connected income.
In order to qualify for any exemptions from withholding described above or for lower withholding tax rates under income tax treaties, or to establish an exemption from backup withholding, a Non-U.S. Shareholder must comply with special certification and filing requirements relating to its non-U.S. status (including, in general, by furnishing an IRS Form W-8BEN, W-8BEN-E or substitute form). Non-U.S. Shareholders are urged to consult their tax advisors regarding the application of U.S. federal income tax rules, including withholding, to their tender of Shares.
Backup Withholding. The Fund generally is required to withhold and remit to the U.S. Treasury a percentage of the taxable distributions and redemption proceeds paid to any individual shareholder who fails to properly furnish the Fund with a correct taxpayer identification number, who has under-reported dividend or interest income, or who fails to certify to the Fund that he or she is not subject to such withholding.
Shareholders should provide the Fund with a completed IRS Form W-9, W-8BEN, W-8BEN-E, as applicable, or other appropriate form in order to avoid backup withholding on the distributions they receive from the Fund regardless of how they are taxed with respect to their tendered Shares. Backup withholding is not an additional tax and any amount withheld may be credited against a shareholder’s U.S. federal income tax liability, provided the appropriate information is furnished to the IRS.
Other Tax Consequences. The Fund’s purchase of Shares in the Offer may directly result in, or contribute to a subsequent, limitation on the Fund’s ability to use capital loss carryforwards to offset future gains. Therefore, in certain circumstances, shareholders who remain shareholders following completion of the Offer may pay taxes sooner, or pay more taxes, than they would have had the Offer not occurred.
Any sales of securities by the Fund to raise cash to meet repurchase requests could result in increased taxable distributions to shareholders. See, “Recognition of Capital Gains” above.
Under Treasury regulations directed at tax shelter activity, if a shareholder recognizes a loss of $2 million or more in the case of an individual shareholder or $10 million or more in the case of a corporate shareholder, such shareholder must file a disclosure statement with the IRS on Form 8886. Direct holders of portfolio securities are in many cases excepted from this reporting requirement, but under current guidance, shareholders of a regulated investment company (“RIC”) are not excepted. Future guidance may extend the current exception from this reporting requirement to shareholders of most or all RICs. The fact that a loss is reportable under these regulations does not affect the legal determination of whether the taxpayer’s treatment of the loss is proper. Shareholders should consult their own tax advisers concerning any possible disclosure obligation with respect to their investment in Shares.
FATCA Withholding. Sections 1471-1474 of the Code and the U.S. Treasury and IRS guidance issued thereunder (collectively, “FATCA”) generally require the Fund to obtain information sufficient to identify the status of each of its Stockholders under FATCA or under an applicable intergovernmental agreement (an “IGA”) between the United States and a foreign government. If a Stockholder fails to provide the requested information or otherwise fails to comply with FATCA or an IGA, the Fund may be required to withhold under FATCA with respect to that Stockholder at a rate of 30% on ordinary dividends it pays. The IRS and the U.S. Treasury Department have issued proposed regulations providing that these withholding rules will not apply to the gross proceeds of share redemptions or capital dividends the Funds pay. If a payment by the Fund is subject to FATCA withholding, the Fund is required to withhold without reference to any other withholding exemption.
Stockholders are urged to consult their own tax advisers regarding the application of U.S. federal income tax withholding, including eligibility for a withholding tax reduction or exemption, and the applicable refund procedure, if any.
15. EXTENSION OF TENDER PERIOD; TERMINATION; AMENDMENTS.
The Fund reserves the right, at any time and from time to time, to extend the period of time during which the Offer is pending by notifying the Information Agent and making a public announcement thereof. In the event that the Fund so elects to extend the tender period, the NAV for the Shares tendered will be computed as of the close of ordinary trading on the NYSE on the newly designated
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Expiration Date. During any such extension, all Shares previously tendered and not purchased or withdrawn will remain subject to the Offer. The Fund also reserves the right, at any time and from time to time up to and including the Expiration Date, to (a) terminate the Offer and not to purchase or pay for any Shares or, subject to applicable law, postpone payment for Shares upon the occurrence of any of the conditions specified in Section 5, “Certain Conditions of the Offer”; and (b) amend the Offer in any respect by making a public announcement thereof. Such public announcement will be issued no later than 9:30 a.m. New York City time not later than the next business day after the previously scheduled Expiration Date and will disclose the approximate number of Shares tendered as of that date. Without limiting the manner in which the Fund may choose to make a public announcement of extension, termination or amendment, except as provided by applicable law (including Rule 13e-4(d)(2), Rule 13e-4(e)(3), and Rule 14e-1(d) under the Exchange Act), the Fund shall have no obligation to publish, advertise or otherwise communicate any such public announcement.
If the Fund materially changes the terms of the Offer or the information concerning the Offer, or if it waives a material condition of the Offer, the Fund will extend the Offer to the extent required by Rules 13e-4(d)(2) and 13e-4(e)(3) under the Exchange Act. These rules require that the minimum period during which an offer must remain open following material changes in the terms of the offer or information concerning the offer (other than a change in price or a change in percentage of securities sought) will depend on the facts and circumstances, including the relative materiality of such terms or information. If (i) the Fund increases or decreases the price to be paid for Shares, or the Fund increases or decreases the number of Shares being sought and (ii) the Expiration Date is less than ten business days away, then the Expiration Date will be extended at least ten business days from the date of the notice.
16. FEES AND EXPENSES.
The Fund will not pay to any broker or dealer, commercial bank, trust company or other person any solicitation fee for any Shares purchased pursuant to the Offer. The Fund will reimburse these firms for customary handling and mailing expenses incurred in forwarding the Offer. No broker, dealer, commercial bank or trust company has been authorized to act as the agent of the Fund or the Depositary for purposes of the Offer.
The Fund has retained EQ Fund Solutions (“EQ”) to act as information agent, and Equiniti Trust Company, LLC (“Equiniti”) to act as Depositary. The Fund will pay the EQ and Equiniti reasonable and customary compensation for their services and will also reimburse them for certain out-of-pocket expenses and indemnify them against certain liabilities. Shares will be purchased at 98.5% of the Fund’s NAV, which will at least partially offset the fees charged by the Information Agent and Depository, among other costs.
17. MISCELLANEOUS.
The Offer is not being made to, nor will the Fund accept tenders from, owners of Shares in any jurisdiction in which the Offer or its acceptance would not comply with the securities or Blue Sky laws of that jurisdiction. The Fund is not aware of any jurisdiction in which the making of the Offer or the tender of Shares would not be in compliance with the laws of that jurisdiction. However, the Fund reserves the right to exclude holders in any jurisdiction in which it is asserted that the Offer cannot lawfully be made. So long as the Fund makes a good faith effort to comply with any state law deemed applicable to the Offer, the Fund believes that the exclusions of holders residing in that jurisdiction is permitted under Rule 13e-4(f)(9) under the Exchange Act.
THE KOREA FUND, INC.
August 16, 2024
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Exhibit (a)(1)(ii)
LETTER OF TRANSMITTAL
TO TENDER SHARES OF COMMON STOCK OF
THE KOREA FUND, INC.
Pursuant to the Offer to Purchase
dated August 16, 2024
THE EXPIRATION DATE AND THE WITHDRAWAL DEADLINE IS 5:00 P.M.,
EASTERN TIME, ON SEPTEMBER 16, 2024, UNLESS EXTENDED
The Depositary for the Offer is:
Equiniti Trust Company, LLC
| If delivering by hand, express mail, courier, or other expedited service: |
By mail: | |
| Equiniti Trust Company, LLC 55 Challenger Road Suite # 200 Ridgefield Park, New Jersey 07660 Attn: Reorganization Department |
Equiniti Trust Company, LLC Operations Center P.O. Box 525 Ridgefield Park, New Jersey 07660 Attn: Reorganization Department | |
Delivery of this Letter of Transmittal to an address other than as set forth above will not constitute a valid delivery to the Depositary. You must sign this Letter of Transmittal in the appropriate space provided below, with signature guarantee if required, and complete the Substitute Form W-9 set forth below.
The instructions contained within this Letter of Transmittal should be read carefully before this Letter of Transmittal is completed.
| DESCRIPTION OF SHARES OF COMMON STOCK TENDERED | ||||||
|
Names(s) and Address(es) of Registered Holder(s) (Please Fill in, if blank) |
Share Certificate(s) and Shares(s) Tendered (Please attach additional signed list, if necessary) | |||||
| Common Stock Share Certificate Number(s)(1) |
Total Number of Shares of Common Stock Represented by Share |
Number of Shares of Common Stock | ||||
| Total Shares Tendered |
||||||
|
|
(1) Need not be completed by shareholders who deliver Shares by book-entry transfer (“Book-Entry Shareholders”). (2) Unless otherwise indicated, all Shares represented by Share Certificates delivered to the Depositary will be deemed to have been tendered. See Instruction 4. ☐ Check here if Share Certificates have been lost or mutilated. | |||||
REGISTRATION
IF FUNDS ARE TO BE WIRED TO THE NAME SHOWN AT THE TOP OF THIS FORM OR CHECKS ARE TO BE ISSUED IN A NAME OTHER THAN THAT SHOWN AT THE TOP OF THIS FORM OR ARE TO BE SENT TO AN ADDRESS OTHER THAN THAT SHOWN AT THE TOP OF THIS FORM, PLEASE CHECK ☐ THE BOX AND COMPLETE THE FOLLOWING INFORMATION
| SPECIAL ISSUANCE INSTRUCTIONS
To be completed ONLY if checks(s)/shares are to be issued in the name of someone other than the registered holder(s)
Name: Address:
EMPLOYER IDENTIFICATION OR SOCIAL SECURITY NUMBER
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See instructions regarding signature guarantee. (See Instructions 1, 5, 6 and 7) |
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| SPECIAL DELIVERY INSTRUCTIONS
See instructions regarding signature guarantee. (See Instructions 1, 5, 6 and 7)
Part 1: To be completed ONLY if the funds are to be wired to the registered holder:
Account Name: Account Number: ABA Number: Further Instructions:
Part 2: To be completed ONLY if check(s)/shares are to be mailed to someone other than the registered holder(s) or such registered holder(s) at an address other than shown on the top of this form. Name: Address:
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PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY,
SIGN AND COMPLETE THE W-9 FORM
Ladies and Gentlemen:
The undersigned hereby tenders to The Korea Fund, Inc., a non-diversified, closed-end management investment company incorporated under the laws of the State of Maryland (the “Fund”), the shares described above of its common stock, par value $0.01 per share (the “Shares”), at a price equal to 98.5% of the net asset value per Share (“NAV”) calculated on the Expiration Date (as defined in the Offer to Purchase), in cash, upon the terms and conditions set forth in the Offer to Purchase dated August 16, 2024, receipt of which is hereby acknowledged, and in this Letter of Transmittal (which together constitute the “Offer”).
The undersigned hereby sells to the Fund all Shares tendered hereby that are purchased pursuant to the Offer and hereby irrevocably constitutes and appoints the Transfer Agent as attorney in fact of the undersigned, with full power of substitution (such power of attorney being deemed to be an irrevocable power coupled with an interest), to present such Shares and any applicable Share certificates for cancellation of such Shares on the Fund’s books. The undersigned hereby warrants that the undersigned has full authority to sell the Shares tendered hereby and that the Fund will acquire good title thereto, free and clear of all liens, charges, encumbrances, conditional sales agreements or other obligations relating to the sale thereof, and not subject to any adverse claim, when and to the extent the same are purchased by it. Upon request, the undersigned will execute and deliver any additional documents necessary to complete the sale in accordance with the terms of the Offer.
The undersigned recognizes that under certain circumstances set forth in the Offer to Purchase, the Fund may not be required to purchase any of the Shares tendered hereby. In that event, the undersigned understands that, in the case of Shares evidenced by certificates, certificate(s) for any Shares not purchased will be returned to the undersigned at the address indicated above. In the case of Shares not evidenced by certificates and held in an investment account, the Transfer Agent will cancel the tender order and no Shares will be withdrawn from the account.
All authority herein conferred or agreed to be conferred shall survive the death or incapacity of the undersigned and the obligation of the undersigned hereunder shall be binding upon the heirs, personal representatives, successors and assigns of the undersigned. Except as stated in the Offer, this tender is irrevocable.
SIGN HERE
(See Instructions 1, 5, and 8)
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Must be signed by registered holder(s) exactly as name(s) appear on first page. If signature is by a trustee, executor, administrator, guardian, attorney-in-fact, officer of a corporation or other person acting in a fiduciary or representative capacity, please set forth the following information:
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GUARANTEE OF SIGNATURE(s)
(SEE INSTRUCTIONS)
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INSTRUCTIONS
Forming Part of the Terms and Conditions of the Offer
1. Guarantee of Signatures. If checks are to be issued in a name other than that shown at the top of this form or are to be sent to an address other than that shown at the top of this form, the signatures on this Letter of Transmittal must be guaranteed by a member firm of a registered national securities exchange or a commercial bank or trust company having an office, branch or agency in the United States. This Letter of Transmittal is to be used only if you may effect the tender offer transaction yourself and do not intend to request your broker to effect the transaction for you.
2. Delivery of Letter of Transmittal. A properly completed and duly executed Letter of Transmittal, should be mailed or delivered to the Transfer Agent on or prior to the Expiration Date at the appropriate address as noted on the bottom on the last page herein and must be received by the Transfer Agent prior to the Expiration Date. The method of delivery of certificate(s) and all other required documents is at the election and risk of the owner. If you elect to send them by mail, it is recommended that you send them by certified or registered mail with return receipt requested. Delivery will be deemed effective and risk of loss and title will pass from the owner only when received by the Exchange Agent. If you submit this Letter of Transmittal by facsimile, you must also send or deliver your certificate(s) in order to receive payment. If the certificate(s) are sent by mail, registered mail with return receipt requested and proper insurance is suggested.
3. Inadequate Space. If the space provided is inadequate, the number of Shares should be listed on a separate signed schedule attached hereto.
4. Partial Tenders. If fewer than all of the Shares in your investment account or evidenced by any certificate submitted are to be tendered, fill in the number of Shares which are to be tendered in the column entitled “Number of Shares of Common Stock Tendered.” If applicable, a new certificate for the remainder of the Shares evidenced by your old certificate(s) will be sent to you as soon as practicable after the Expiration Date of the Offer. All Shares represented by certificate(s) listed or in your investment account are deemed to have been tendered unless otherwise indicated.
5. Signatures on Letter of Transmittal, Authorization and Endorsements.
(a) If the Letter of Transmittal is signed by the registered holder of the Shares tendered hereby, the signatures(s) must correspond with the name(s) in which the Shares are registered.
(b) If the Shares are held of record by two or more joint holders, all such holders must sign this Letter of Transmittal.
(c) If any tendered Shares are registered in different names it will be necessary to complete, sign and submit as many separate Letters of Transmittal as there are different registrations of Shares.
(d) When this Letter of Transmittal is signed by the registered holder(s) of the Shares listed and, if applicable, of the certificates transmitted hereby, no endorsements of certificates or separate authorizations are required.
(e) If this Letter of Transmittal or any certificates or authorizations are signed by trustees, executors, administrators, guardians, attorneys in fact, officers of corporations or others acting in a fiduciary or representative capacity, such persons should so indicate when signing, and must submit proper evidence satisfactory to the Fund of their authority so to act.
6. Transfer Taxes. The Fund will pay all the taxes, if any, payable on the transfer to it of Shares purchased pursuant to the Offer. If tendered certificates are registered in the name of any person other than the person(s) signing this Letter of Transmittal, the amount of any transfer taxes (whether imposed on the registered holder or such other person) payable on account of the transfer to such person will be deducted from the purchase price unless satisfactory evidence of the payment of such taxes or exemption therefrom is submitted.
7. Special Payment and Delivery Instructions. If a check for the purchase price is to be issued, and/or Share Certificates representing Shares not tendered or accepted for payment are to be issued or returned to, a person other than the signer(s) of this Letter of Transmittal or to an address other than that shown in the box titled “Description of Shares Tendered” above, the appropriate boxes on this Letter of Transmittal should be completed. Stockholders completing either or both sections must be guaranteed by a firm that is a bank, broker, dealer, credit union, savings association or other entity that is an Eligible Institution. Stockholders delivering Shares tendered hereby or by Agent’s Message by book-entry transfer may request that Shares not purchased be credited to an account maintained at DTC as such stockholder may designate in the box titled “Special Payment Instructions” herein. If no such instructions are given, all such Shares not purchased will be returned by crediting the same account at DTC as the account from which such Shares were delivered.
8. Irregularities. All questions as to the validity, form, eligibility (including time of receipt) and acceptance of any tender of Shares will be determined by the Fund in its sole discretion, which determination shall be final and binding. The Fund reserves the absolute right to reject any or all tenders determined by it not to be in appropriate form or the acceptance of or payment for which would, in the opinion of counsel for the Fund, be unlawful. The Fund also reserves the absolute right to waive any of the conditions of the Offer or any defect in any tender with respect to any particular Shares or any particular stockholder, and the Fund’s interpretations of the terms and conditions of the Offer (including these instructions) will be final and binding. Unless waived, any defects or irregularities in connection with tenders must be cured within such time as the Fund shall determine. Tenders will not be deemed to have been made until all defects and irregularities have been cured or waived. Neither the Fund, JPMorgan Asset Management (Asia Pacific), the Transfer Agent, nor any other person shall be obligated to give notice of defects or irregularities in tenders, nor shall any of them incur any liability for failure to give any such notice.
9. Important Tax Information. Under Federal income tax law, a stockholder whose tendered Shares are accepted for payment is required by law to provide the Transfer Agent (as payer) with his correct taxpayer identification number, which is accomplished by completing and signing the Signature Form.
Form W-9 (Rev. March 2024) Department of the Treasury Internal Revenue Service Request for Taxpayer Identification Number and Certification Go to www.irs.gov/FormW9 for instructions and the latest information. Give form to the requester. Do not send to the IRS. Before you begin. For guidance related to the purpose of Form W-9, see Purpose of Form, below. Print or type. See specific instructions on page 3. 1 Name of enity/individual. An entry is required. (For a sole proprietor or disregarded entity, enter t he owner’s name on line 1, and enter the business/disregarded enitity’s name on line 2.) 2 Business name/disregarded entity name, if different from above. 3a Check the appropriate box for federal tax classification of the entity/individual whose name is entered on line 1. Check only one of the following seven boxes. Individual/sole proprietor C corporation S corporation Partnership Trust/estate LLC. Enter the tax classification (C = C corporation, S =S corporation, P = Partnership) Note: Check the “ LLC” box above and, in the entry space, enter the appropriate code (C, S, or P) for the tax classification of the LLC, unless it is a disregarded entity. A disregarded entity should instead check the appropriate box for the tax classification of its owner. Other (see instructions) 3b If on line 3a you checked “Partnership” or “Trust/estate,” or checked “LLC” and entered “P” as its tax classification, and you are providing this form to a partnership, trust, or estate in which you have an ownership interest, check this box if you have any foreign partners, owners, or beneficiaries. See instructions Exemptions (codes apply only to certain entities, not individuals; see instructions on page 3): Exempt payee code (if any) Exemption from Foreign Account Tax Compliance Act (FATCA) reporting code (if any) (Applies to accounts maintained outside the United States.) 5 Address (number, street, and apt. or suite no.). see instructions. 6 City, state, and ZIP code 7 List account number(s) here (optional) Requester’s name and address (optional) Part I taxpayer identification number (TIN) Enter your TIN in the appropriate box. The TIN provided must match the name given on line 1 to avoid backup withholding. For individuals, this is generally your social security number (SSN). However, for a resident alien, sole proprietor, or disregarded entity, see the instructions for Part I, later. For other entities, it is your employer identification number (EIN). If you do not have a number, see How to get a TIN, later. Note: If the account is in more than one name, see the instructions for line 1. See also What Name and Number To Give the Requester for guidelines on whose number to enter. Social security number or employer identification number Part II Certification Under penalties of perjury, I certify that: 1. The number shown on this form is my correct taxpayer identification number (or I am waiting for a number to be issued to me); and 2. I am not subject to backup withholding because (a) I am exempt from backup withholding, or (b) I have not been notified by the Internal Revenue Service (IRS) that I am subject to backup withholding as a result of a failure to report all interest or dividends, or (c) the IRS has notified me that I am no longer subject to backup withholding; and 3. I am a U.S. citizen or other U.S. person (defined below); and 4. The FATCA code(s) entered on this form (if any) indicating that I am exempt from FATCA reporting is correct. Certification instructions. You must cross out item 2 above if you have been notified by the IRS that you are currently subject to backup withholding because you have failed to report all interest and dividends on your tax return. For real estate transactions, item 2 does not apply. For mortgage interest paid, acquisition or abandonment of secured property, cancellation of debt, contributions to an individual retirement arrangement (IRA), and, generally, payments other than interest and dividends, you are not required to sign the certification, but you must provide your correct TIN. See the instructions for Part II, later. Sign Here signature of U.S. person General Instructions Section references are to the Internal Revenue Code unless otherwise noted. Future developments. For the latest information about developments related to Form W-9 and its instructions, such as legislation enacted after they were published, go to www.irs.gov/FormW9. What’s New Line 3a has been modified to clarify how a disregarded entity completes this line. An LLC that is a disregarded entity should check the appropriate box for the tax classification of its owner. Otherwise, it should check the “LLC” box and enter its appropriate tax classification. Date New line 3b has been added to this form. A flow-through entity is required to complete this line to indicate that it has direct or indirect foreign partners, owners, or beneficiaries when it provides the Form W-9 to another flow-through entity in which it has an ownership interest. This change is intended to provide a flow-through entity with information regarding the status of its indirect foreign partners, owners, or beneficiaries, so that it can satisfy any applicable reporting requirements. For example, a partnership that has any indirect foreign partners may be required to complete Schedules K-2 and K-3. See the Partnership Instructions for Schedules K-2 and K-3 (Form 1065). Purpose of Form An individual or entity (Form W-9 requester) who is required to file an information return with the IRS is giving you this form because they Cat. No. 10231X Form W-9 (Rev. 3-2024)
Form W-9 (Rev. 3-2024) Page 2 must obtain your correct taxpayer identification number (TIN), which may be your social security number (SSN), individual taxpayer identification number (ITIN), adoption taxpayer identification number (ATIN), or employer identification number (EIN), to report on an information return the amount paid to you, or other amount reportable on an information return. Examples of information returns include, but are not limited to, the following. Form 1099-INT (interest earned or paid). Form 1099-DIV (dividends, including those from stocks or mutual funds). Form 1099-MISC (various types of income, prizes, awards, or gross proceeds). Form 1099-NEC (nonemployee compensation). Form 1099-B (stock or mutual fund sales and certain other transactions by brokers). Form 1099-S (proceeds from real estate transactions). Form 1099-K (merchant card and third-party network transactions). Form 1098 (home mortgage interest), 1098-E (student loan interest), and 1098-T (tuition). Form 1099-C (canceled debt). Form 1099-A (acquisition or abandonment of secured property). Use Form W-9 only if you are a U.S. person (including a resident alien), to provide your correct TIN. Caution: If you don’t return Form W-9 to the requester with a TIN, you might be subject to backup withholding. See What is backup withholding, later. By signing the filled-out form, you: 1. Certify that the TIN you are giving is correct (or you are waiting for a number to be issued); 2. Certify that you are not subject to backup withholding; or 3. Claim exemption from backup withholding if you are a U.S. exempt payee; and 4. Certify to your non-foreign status for purposes of withholding under chapter 3 or 4 of the Code (if applicable); and 5. Certify that FATCA code(s) entered on this form (if any) indicating that you are exempt from the FATCA reporting is correct. See What is FATCA Reporting, later, for further information. Note: If you are a U.S. person and a requester gives you a form other than Form W-9 to request your TIN, you must use the requester’s form if it is substantially similar to this Form W-9. Definition of a U.S. person. For federal tax purposes, you are considered a U.S. person if you are: An individual who is a U.S. citizen or U.S. resident alien; A partnership, corporation, company, or association created or organized in the United States or under the laws of the United States; An estate (other than a foreign estate); or A domestic trust (as defined in Regulations section 301.7701-7). Establishing U.S. status for purposes of chapter 3 and chapter 4 withholding. Payments made to foreign persons, including certain distributions, allocations of income, or transfers of sales proceeds, may be subject to withholding under chapter 3 or chapter 4 of the Code (sections 1441-1474). Under those rules, if a Form W-9 or other certification of non-foreign status has not been received, a withholding agent, transferee, or partnership (payor) generally applies presumption rules that may require the payor to withhold applicable tax from the recipient, owner, transferor, or partner (payee). See Pub. 515, Withholding of Tax on Nonresident Aliens and Foreign Entities. The following persons must provide Form W-9 to the payor for purposes of establishing its non-foreign status. In the case of a disregarded entity with a U.S. owner, the U.S. owner of the disregarded entity and not the disregarded entity. In the case of a grantor trust with a U.S. grantor or other U.S. owner, generally, the U.S. grantor or other U.S. owner of the grantor trust and not the grantor trust. In the case of a U.S. trust (other than a grantor trust), the U.S. trust and not the beneficiaries of the trust. See Pub. 515 for more information on providing a Form W-9 or a certification of non-foreign status to avoid withholding. Foreign person. If you are a foreign person or the U.S. branch of a foreign bank that has elected to be treated as a U.S. person (under Regulations section 1.1441-1(b)(2)(iv) or other applicable section for chapter 3 or 4 purposes), do not use Form W-9. Instead, use the appropriate Form W-8 or Form 8233 (see Pub. 515). If you are a qualified foreign pension fund under Regulations section 1.897(I)-1(d), or a partnership that is wholly owned by qualified foreign pension funds, that is treated as a non-foreign person for purposes of section 1445 withholding, do not use Form W-9. Instead, use Form W-8EXP (or other certification of non-foreign status). Nonresident alien who becomes a resident alien. Generally, only a nonresident alien individual may use the terms of a tax treaty to reduce or eliminate U.S. tax on certain types of income. However, most tax treaties contain a provision known as a saving clause. Exceptions specified in the saving clause may permit an exemption from tax to continue for certain types of income even after the payee has otherwise become a U.S. resident alien for tax purposes. If you are a U.S. resident alien who is relying on an exception contained in the saving clause of a tax treaty to claim an exemption from U.S. tax on certain types of income, you must attach a statement to Form W-9 that specifies the following five items. 1. The treaty country. Generally, this must be the same treaty under which you claimed exemption from tax as a nonresident alien. 2. The treaty article addressing the income. 3. The article number (or location) in the tax treaty that contains the saving clause and its exceptions. 4. The type and amount of income that qualifies for the exemption from tax. 5. Sufficient facts to justify the exemption from tax under the terms of the treaty article. Example. Article 20 of the U.S.-China income tax treaty allows an exemption from tax for scholarship income received by a Chinese student temporarily present in the United States. Under U.S. law, this student will become a resident alien for tax purposes if their stay in the United States exceeds 5 calendar years. However, paragraph 2 of the first Protocol to the U.S.-China treaty (dated April 30, 1984) allows the provisions of Article 20 to continue to apply even after the Chinese student becomes a resident alien of the United States. A Chinese student who qualifies for this exception (under paragraph 2 of the first Protocol) and is relying on this exception to claim an exemption from tax on their scholarship or fellowship income would attach to Form W-9 a statement that includes the information described above to support that exemption. If you are a nonresident alien or a foreign entity, give the requester the appropriate completed Form W-8 or Form 8233. Backup Withholding What is backup withholding? Persons making certain payments to you must under certain conditions withhold and pay to the IRS 24% of such payments. This is called “backup withholding.” Payments that may be subject to backup withholding include, but are not limited to, interest, tax-exempt interest, dividends, broker and barter exchange transactions, rents, royalties, nonemployee pay, payments made in settlement of payment card and third-party network transactions, and certain payments from fishing boat operators. Real estate transactions are not subject to backup withholding. You will not be subject to backup withholding on payments you receive if you give the requester your correct TIN, make the proper certifications, and report all your taxable interest and dividends on your tax return. Payments you receive will be subject to backup withholding if: 1. You do not furnish your TIN to the requester; 2. You do not certify your TIN when required (see the instructions for Part II for details); 3. The IRS tells the requester that you furnished an incorrect TIN; 4. The IRS tells you that you are subject to backup withholding because you did not report all your interest and dividends on your tax return (for reportable interest and dividends only); or 5. You do not certify to the requester that you are not subject to backup withholding, as described in item 4 under “By signing the filled-out form” above (for reportable interest and dividend accounts opened after 1983 only).
Form W-9 (Rev. 3-2024) Page 3 Certain payees and payments are exempt from backup withholding. See Exempt payee code, later, and the separate Instructions for the Requester of Form W-9 for more information. See also Establishing U.S. status for purposes of chapter 3 and chapter 4 withholding, earlier. What Is FATCA Reporting? The Foreign Account Tax Compliance Act (FATCA) requires a participating foreign financial institution to report all U.S. account holders that are specified U.S. persons. Certain payees are exempt from FATCA reporting. See Exemption from FATCA reporting code, later, and the Instructions for the Requester of Form W-9 for more information. Updating Your Information You must provide updated information to any person to whom you claimed to be an exempt payee if you are no longer an exempt payee and anticipate receiving reportable payments in the future from this person. For example, you may need to provide updated information if you are a C corporation that elects to be an S corporation, or if you are no longer tax exempt. In addition, you must furnish a new Form W-9 if the name or TIN changes for the account, for example, if the grantor of a grantor trust dies. Penalties Failure to furnish TIN. If you fail to furnish your correct TIN to a requester, you are subject to a penalty of $50 for each such failure unless your failure is due to reasonable cause and not to willful neglect. Civil penalty for false information with respect to withholding. If you make a false statement with no reasonable basis that results in no backup withholding, you are subject to a $500 penalty. Criminal penalty for falsifying information. Willfully falsifying certifications or affirmations may subject you to criminal penalties including fines and/or imprisonment. Misuse of TINs. If the requester discloses or uses TINs in violation of federal law, the requester may be subject to civil and criminal penalties. Specific Instructions Line 1 You must enter one of the following on this line; do not leave this line blank. The name should match the name on your tax return. If this Form W-9 is for a joint account (other than an account maintained by a foreign financial institution (FFI)), list first, and then circle, the name of the person or entity whose number you entered in Part I of Form W-9. If you are providing Form W-9 to an FFI to document a joint account, each holder of the account that is a U.S. person must provide a Form W-9. Individual. Generally, enter the name shown on your tax return. If you have changed your last name without informing the Social Security Administration (SSA) of the name change, enter your first name, the last name as shown on your social security card, and your new last name. Note for ITIN applicant: Enter your individual name as it was entered on your Form W-7 application, line 1a. This should also be the same as the name you entered on the Form 1040 you filed with your application. Sole proprietor. Enter your individual name as shown on your Form 1040 on line 1. Enter your business, trade, or “doing business as” (DBA) name on line 2. Partnership, C corporation, S corporation, or LLC, other than a disregarded entity. Enter the entity’s name as shown on the entity’s tax return on line 1 and any business, trade, or DBA name on line 2. Other entities. Enter your name as shown on required U.S. federal tax documents on line 1. This name should match the name shown on the charter or other legal document creating the entity. Enter any business, trade, or DBA name on line 2. Disregarded entity. In general, a business entity that has a single owner, including an LLC, and is not a corporation, is disregarded as an entity separate from its owner (a disregarded entity). See Regulations section 301.7701-2(c)(2). A disregarded entity should check the appropriate box for the tax classification of its owner. Enter the owner’s name on line 1. The name of the owner entered on line 1 should never be a disregarded entity. The name on line 1 should be the name shown on the income tax return on which the income should be reported. For example, if a foreign LLC that is treated as a disregarded entity for U.S. federal tax purposes has a single owner that is a U.S. person, the U.S. owner’s name is required to be provided on line 1. If the direct owner of the entity is also a disregarded entity, enter the first owner that is not disregarded for federal tax purposes. Enter the disregarded entity’s name on line 2. If the owner of the disregarded entity is a foreign person, the owner must complete an appropriate Form W-8 instead of a Form W-9. This is the case even if the foreign person has a U.S. TIN. Line 2 If you have a business name, trade name, DBA name, or disregarded entity name, enter it on line 2. Line 3a Check the appropriate box on line 3a for the U.S. federal tax classification of the person whose name is entered on line 1. Check only one box on line 3a. IF the entity/individual on line 1 is a(n) Corporation Individual or Body Sole proprietorship LLC classified as a partnership for U.S. federal tax purposes or LLC that has filed Form 8832 or 2553 electing to be taxed as a corporation Partnership Trust/estate THEN check the box for Corporation Individual/sole proprietor. Limited liability company and enter the appropriate tax classification: P = Partnership, C = C corporation, or S = S corporation. Partnership. Trust/estate Line 3b Check this box if you are a partnership (including an LLC classified as a partnership for U.S. federal tax purposes), trust, or estate that has any foreign partners, owners, or beneficiaries, and you are providing this form to a partnership, trust, or estate, in which you have an ownership interest. You must check the box on line 3b if you receive a Form W-8 (or documentary evidence) from any partner, owner, or beneficiary establishing foreign status or if you receive a Form W-9 from any partner, owner, or beneficiary that has checked the box on line 3b. Note: A partnership that provides a Form W-9 and checks box 3b may be required to complete Schedules K-2 and K-3 (Form 1065). For more information, see the Partnership Instructions for Schedules K-2 and K-3 (Form 1065). If you are required to complete line 3b but fail to do so, you may not receive the information necessary to file a correct information return with the IRS or furnish a correct payee statement to your partners or beneficiaries. See, for example, sections 6698, 6722, and 6724 for penalties that may apply. Line 4 Exemptions If you are exempt from backup withholding and/or FATCA reporting, enter in the appropriate space on line 4 any code(s) that may apply to you. Exempt payee code. Generally, individuals (including sole proprietors) are not exempt from backup withholding. Except as provided below, corporations are exempt from backup withholding for certain payments, including interest and dividends. Corporations are not exempt from backup withholding for payments made in settlement of payment card or third-party network transactions. Corporations are not exempt from backup withholding with respect to attorneys’ fees or gross proceeds paid to attorneys, and corporations that provide medical or health care services are not exempt with respect to payments reportable on Form 1099-MISC. The following codes identify payees that are exempt from backup withholding. Enter the appropriate code in the space on line 4. 1-An organization exempt from tax under section 501(a), any IRA, or a custodial account under section 403(b)(7) if the account satisfies the requirements of section 401(f)(2).
Form W-9 (Rev. 3-2024) Page 4 2-The United States or any of its agencies or instrumentalities. 3-A state, the District of Columbia, a U.S. commonwealth or territory, or any of their political subdivisions or instrumentalities. 4-A foreign government or any of its political subdivisions, agencies, or instrumentalities. 5-A corporation. 6-A dealer in securities or commodities required to register in the United States, the District of Columbia, or a U.S. commonwealth or territory. 7-A futures commission merchant registered with the Commodity Futures Trading Commission. 8-A real estate investment trust. 9-An entity registered at all times during the tax year under the Investment Company Act of 1940. 10-A common trust fund operated by a bank under section 584(a). 11-A financial institution as defined under section 581. 12-A middleman known in the investment community as a nominee or custodian. 13-A trust exempt from tax under section 664 or described in section 4947. The following chart shows types of payments that may be exempt from backup withholding. The chart applies to the exempt payees listed above, 1 through 13. IF the payment is for . .. THEN the payment is exempt for... Interest and dividend payments All exempt payees except for 7. Broker transactions Exempt payees 1 through 4 and 6 through 11 and all C corporations. S corporations must not enter an exempt payee code because they are exempt only for sales of non covered securities acquired prior to 2012. Barter exchange transactions Exempt payees 1 through 4. and patronage dividends Payments over $600 required to Generally, exempt payees be reported and direct sales over 1 through 5.2 $5,0001 Payments made in settlement of Exempt payees 1 through 4. payment card or third-party network transactions 1 See Form 1099-MISC, Miscellaneous Information, and its instructions. 2 However, the following payments made to a corporation and reportable on Form 1099- MISC are not exempt from backup withholding: medical and health care payments, attorneys’ fees, gross proceeds paid to an attorney reportable under section 6045(f), and payments for services paid by a federal executive agency. Exemption from FATCA reporting code. The following codes identify payees that are exempt from reporting under FATCA. These codes apply to persons submitting this form for accounts maintained outside of the United States by certain foreign financial institutions. Therefore, if you are only submitting this form for an account you hold in the United States, you may leave this field blank. Consult with the person requesting this form if you are uncertain if the financial institution is subject to these requirements. A requester may indicate that a code is not required by providing you with a Form W-9 with “Not Applicable” (or any similar indication) entered on the line for a FATCA exemption code. A-An organization exempt from tax under section 501(a) or any individual retirement plan as defined in section 7701(a)(37). B-The United States or any of its agencies or instrumentalities. C-A state, the District of Columbia, a U.S. commonwealth or territory, or any of their political subdivisions or instrumentalities. D-A corporation the stock of which is regularly traded on one or more established securities markets, as described in Regulations section 1.1472-1(c)(1)(i). E-A corporation that is a member of the same expanded affiliated group as a corporation described in Regulations section 1.1472-1(c)(1)(i). F-A dealer in securities, commodities, or derivative financial instruments (including notional principal contracts, futures, forwards, and options) that is registered as such under the laws of the United States or any state. G-A real estate investment trust. H- A regulated investment company as defined in section 851 or an entity registered at all times during the tax year under the Investment Company Act of 1940. I-A common trust fund as defined in section 584(a). J- A bank as defined in section 581. K-A broker. L-A trust exempt from tax under section 664 or described in section 4947(a)(1) . M-A tax-exempt trust under a section 403(b) plan or section 457(g) plan. Note: You may wish to consult with the financial institution requesting this form to determine whether the FATCA code and/or exempt payee code should be completed. Line 5 Enter your address (number, street, and apartment or suite number). This is where the requester of this Form W-9 will mail your information returns. If this address differs from the one the requester already has on file, enter “NEW” at the top. If a new address is provided, there is still a chance the old address will be used until the payor changes your address in their records. Line 6 Enter your city, state, and ZIP code. Part I. Taxpayer Identification Number (TIN) Enter your TIN in the appropriate box. If you are a resident alien and you do not have, and are not eligible to get, an SSN, your TIN is your IRS ITIN. Enter it in the entry space for the Social security number. If you do not have an ITIN, see How to get a TIN below. If you are a sole proprietor and you have an EIN, you may enter either your SSN or EIN. If you are a single-member LLC that is disregarded as an entity separate from its owner, enter the owner’s SSN (or EIN, if the owner has one). If the LLC is classified as a corporation or partnership, enter the entity’s El N. Note: See What Name and Number To Give the Requester, later, for further clarification of name and TIN combinations. How to get a TIN. If you do not have a TIN, apply for one immediately. To apply for an SSN, get Form SS-5, Application for a Social Security Card, from your local SSA office or get this form online at www.SSA.gov. You may also get this form by calling 800-772-1213. Use Form W-7, Application for IRS Individual Taxpayer Identification Number, to apply for an ITIN, or Form SS-4, Application for Employer Identification Number, to apply for an EIN. You can apply for an EIN online by accessing the IRS website at www.irs.gov/EIN. Go to www.irs.gov/Forms to view, download, or print Form W-7 and/or Form SS-4. Or, you can go to www.irs.gov/OrderForms to place an order and have Form W-7 and/or Form SS-4 mailed to you within 15 business days. If you are asked to complete Form W-9 but do not have a TIN, apply for a TIN and enter “Applied For” in the space for the TIN, sign and date the form, and give it to the requester. For interest and dividend payments, and certain payments made with respect to readily tradable instruments, you will generally have 60 days to get a TIN and give it to the requester before you are subject to backup withholding on payments. The 60-day rule does not apply to other types of payments. You will be subject to backup withholding on all such payments until you provide your TI N to the requester. Note: Entering “Applied For” means that you have already applied for a TIN or that you intend to apply for one soon. See also Establishing U.S. status for purposes of chapter 3 and chapter 4 withholding, earlier, for when you may instead be subject to withholding under chapter 3 or 4 of the Code. Caution: A disregarded U.S. entity that has a foreign owner must use the appropriate Form W-8.
Form W-9 (Rev. 3-2024) Page 5 Part II. Certification To establish to the withholding agent that you are a U.S. person, or resident alien, sign Form W-9. You may be requested to sign by the withholding agent even if item 1, 4, or 5 below indicates otherwise. For a joint account, only the person whose TIN is shown in Part I should sign (when required). In the case of a disregarded entity, the person identified on line 1 must sign. Exempt payees, see Exempt payee code, earlier. Signature requirements. Complete the certification as indicated in items 1 through 5 below. 1. Interest, dividend, and barter exchange accounts opened before 1984 and broker accounts considered active during 1983. You must give your correct TIN, but you do not have to sign the certification. 2. Interest, dividend, broker, and barter exchange accounts opened after 1983 and broker accounts considered inactive during 1983. You must sign the certification or backup withholding will apply. If you are subject to backup withholding and you are merely providing your correct TIN to the requester, you must cross out item 2 in the certification before signing the form. 3. Real estate transactions. You must sign the certification. You may cross out item 2 of the certification. 4. Other payments. You must give your correct TIN, but you do not have to sign the certification unless you have been notified that you have previously given an incorrect TIN. “Other payments” include payments made in the course of the requester’s trade or business for rents, royalties, goods (other than bills for merchandise), medical and health care services (including payments to corporations), payments to a nonemployee for services, payments made in settlement of payment card and third-party network transactions, payments to certain fishing boat crew members and fishermen, and gross proceeds paid to attorneys (including payments to corporations). 5. Mortgage interest paid by you, acquisition or abandonment of secured property, cancellation of debt, qualified tuition program payments (under section 529), ABLE accounts (under section 529A), IRA, Coverdell ESA, Archer MSA or HSA contributions or distributions, and pension distributions. You must give your correct TIN, but you do not have to sign the certification. What Name and Number To Give the Requester For this type of account: Give name and SSN of: 1. Individual The individual 2. Two or more individuals (joint account) The actual owner1 of the account or, other than an account maintained by if combined funds, the first individual an FFI on the account 1 3. Two or more U.S. persons Each holder of the account (joint account maintained by an FFI) 4. Custodial account of a minor The minor2 (Uniform Gift to Minors Act) 5. a. The usual revocable savings trust The grantor-trustee1 (grantor is also trustee) b. So-called trust account that is not The actual owner a legal or valid trust under state law 6. Sole proprietorship or disregarded The owner3 entity owned by an individual 7. Grantor trust filing under Optional The grantor1 Filing Method 1 (see Regulations section 1.671-4(b)(2)(i)(A))** For this type of account: Give name and EIN of: 8. Disregarded entity not owned by an The owner individual 9. A valid trust, estate, or pension trust Legal entity4 10. Corporation or LLC electing corporate The corporation status on Form 8832 or Form 2553 11. Association, club, religious, charitable, The organization educational, or other tax-exempt organization 12. Partnership or multi-member LLC The partnership 13. A broker or registered nominee The broker or nominee 14. Account with the Department of The public entity Agriculture in the name of a public entity (such as a state or local government, school district, or prison) that receives agricultural program payments 15. Grantor trust filing Form 1041 or The trust under the Optional Filing Method 2, requiring Form 1099 (see Regulations section 1.671-4(b)(2)(i)(B))** 1 List first and circle the name of the person whose number you furnish. If only one person on a joint account has an SSN, that person’s number must be furnished. 2 Circle the minor’s name and furnish the minor’s SSN. 3 You must show your individual name on line 1, and enter your business or DBA name, if any, on line 2. You may use either your SSN or EIN (if you have one), but the IRS encourages you to use your SSN. 4 List first and circle the name of the trust, estate, or pension trust. (Do not furnish the TIN of the personal representative or trustee unless the legal entity itself is not designated in the account title.) * Note: The grantor must also provide a Form W-9 to the trustee of the trust. ** For more information on optional filing methods for grantor trusts, see the Instructions for Form 1041. Note: If no name is circled when more than one name is listed, the number will be considered to be that of the first name listed. Secure Your Tax Records From Identity Theft Identity theft occurs when someone uses your personal information, such as your name, SSN, or other identifying information, without your permission to commit fraud or other crimes. An identity thief may use your SSN to get a job or may file a tax return using your SSN to receive a refund. To reduce your risk: Protect your SSN, Ensure your employer is protecting your SSN, and Be careful when choosing a tax return preparer. If your tax records are affected by identity theft and you receive a notice from the IRS, respond right away to the name and phone number printed on the IRS notice or letter. If your tax records are not currently affected by identity theft but you think you are at risk due to a lost or stolen purse or wallet, questionable credit card activity, or a questionable credit report, contact the IRS Identity Theft Hotline at 800-908-4490 or submit Form 14039. For more information, see Pub. 5027, Identity Theft Information for Taxpayers.
Form W-9 (Rev. 3-2024) Page 6 Victims of identity theft who are experiencing economic harm or a systemic problem, or are seeking help in resolving tax problems that have not been resolved through normal channels, may be eligible for Taxpayer Advocate Service (TAS) assistance. You can reach TAS by calling theTAS toll-free case intake line at 877-777-4778 or TTY/TDD 800-829-4059. Protect yourself from suspicious emails or phishing schemes. Phishing is the creation and use of email and websites designed to mimic legitimate business emails and websites. The most common act is sending an email to a user falsely claiming to be an established legitimate enterprise in an attempt to scam the user into surrendering private information that will be used for identity theft. The IRS does not initiate contacts with taxpayers via emails. Also, the IRS does not request personal detailed information through email or ask taxpayers for the PIN numbers, passwords, or similar secret access information for their credit card, bank, or other financial accounts. If you receive an unsolicited email claiming to be from the IRS, forward this message to phishing@irs.gov. You may also report misuse of the IRS name, logo, or other IRS property to the Treasury Inspector General for Tax Administration (TIGTA) at 800-366-4484. You can forward suspicious emails to the Federal Trade Commission at spam@uce.gov or report them at www.ftc.gov/complaint. You can contact the FTC at www.ftc.gov/idtheft or 877-IDTHEFT (877-438-4338). If you have been the victim of identity theft, see www.ldentityTheft.gov and Pub. 5027. Go to www.irs.gov/ldentity Theft to learn more about identity theft and how to reduce your risk. Privacy Act Notice Section 6109 of the Internal Revenue Code requires you to provide your correct TIN to persons (including federal agencies) who are required to file information returns with the IRS to report interest, dividends, or certain other income paid to you; mortgage interest you paid; the acquisition or abandonment of secured property; the cancellation of debt; or contributions you made to an IRA, Archer MSA, or HSA. The person collecting this form uses the information on the form to file information returns with the IRS, reporting the above information. Routine uses of this information include giving it to the Department of Justice for civil and criminal litigation and to cities, states, the District of Columbia, and U.S. commonwealths and territories for use in administering their laws. The information may also be disclosed to other countries under a treaty, to federal and state agencies to enforce civil and criminal laws, or to federal law enforcement and intelligence agencies to combat terrorism. You must provide your TIN whether or not you are required to file a tax return. Under section 3406, payers must generally withhold a percentage of taxable interest, dividends, and certain other payments to a payee who does not give a TIN to the payor. Certain penalties may also apply for providing false or fraudulent information.
Exhibit (a)(1)(iii)
OFFER BY
THE KOREA FUND, INC.
TO PURCHASE FOR CASH UP TO 12.5% OF ITS COMMON SHARES OF BENEFICIAL INTEREST
FOR 98.5% OF NET ASSET VALUE
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON SEPTEMBER 16, 2024 (“EXPIRATION DATE”), UNLESS EXTENDED
THIS OFFER IS NOT CONDITIONED ON ANY MINIMUM NUMBER OF SHARES BEING TENDERED, BUT IS SUBJECT TO OTHER CONDITIONS AS OUTLINED IN THE FUND’S OFFER TO PURCHASE
AND IN THE LETTER OF TRANSMITTAL.
August 16, 2024
To Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees:
We are enclosing herewith the material listed below relating to the offer of The Korea Fund, Inc. a Maryland corporation registered under the Investment Company Act of 1940, as amended, as a closed-end, non-diversified management investment company (the “Fund”), to purchase up to 12.5% of its outstanding common shares of beneficial interest, par value $0.01 (the “Shares”) upon the terms and subject to the conditions set forth in its Offer to Purchase dated August 16, 2024 and in the related Letter of Transmittal (which together constitute the “Offer”). The price to be paid for the Shares is an amount per Share, net to the seller in cash, equal to 98.5% of the net asset value per Share as determined by the Fund as of the close of ordinary trading on the New York Stock Exchange (“NYSE”) on September 16, 2024, or if the Offer period is extended, as of the close of ordinary trading on the NYSE on the newly designated expiration date.
We are asking you to contact your clients for whom you hold Shares registered in your name (or in the name of your nominee) or who hold Shares registered in their own names. Please bring the Offer to their attention as promptly as possible. No fees or commission will be payable to brokers, dealers or other persons for soliciting tenders for Shares pursuant to the Offer. The Fund will, however, upon request, reimburse you for reasonable and customary mailing and handling expenses incurred by you in forwarding any of the enclosed materials to your clients. The Fund will pay all transfer taxes on its purchase of Shares, subject to Section 4, “Payment for Shares” of the Offer to Purchase. However, backup withholding, and in the case of non-U.S. shareholders, 30% withholding under the Foreign Account Tax Compliance Act or 30% (or lower treaty rate) withholding at the source may be required unless either an exemption is proved or the required taxpayer identification information and certifications are provided. See Section 2, “Procedures for Tendering Shares,” of the Offer to Purchase.
For your information and for forwarding to your clients, we are enclosing the following documents:
| 1. | A letter to shareholders from the Chairman of the Board of Directors of the Fund and the Offer to Purchase dated August 16, 2024; |
| 2. | The Letter of Transmittal for your use and to be provided to your clients; |
| 3. | Notice of Guaranteed Delivery; |
| 4. | Form of letter to clients, which may be sent to your clients for whose accounts you hold Shares registered in your name (or in the name of your nominee); and |
| 5. | Return envelope addressed to the Depositary. |
The Offer is not being made to, nor will the Fund accept tenders from, holders of Shares in any State or other jurisdiction in which the Offer would not be in compliance with the securities or Blue Sky laws of such jurisdiction.
As described in the Fund’s Offer to Purchase under Section 2, “Procedures for Tendering Shares,” tenders may be made without the concurrent deposit of Share certificates if (1) such tenders are made by or through an Eligible Guarantor (as defined in the Offer to Purchase); (2) a properly completed and duly executed Notice of Guaranteed Delivery in the form provided by the Fund is delivered to the Depositary prior to 5:00 p.m. New York City time on the Expiration Date; and (3) certificates for tendered Shares (or a Book-Entry Confirmation, as defined in the Offer to Purchase) together with a properly completed and duly executed Letter of Transmittal (or, in the case of book-entry transfer, an Agent’s Message, as defined in the Offer to Purchase), and any other documents required by the Letter of Transmittal, are received by the Depositary within one NYSE trading day after execution of a Notice of Guaranteed Delivery.
As described in the Offer, if more than 12.5% of the Fund’s outstanding Shares are duly tendered prior to the Expiration Date, the Fund will repurchase 12.5% of the Fund’s outstanding Shares on a pro rata basis upon the terms and subject to the conditions of the Offer.
NEITHER THE FUND NOR ITS BOARD OF DIRECTORS MAKES ANY RECOMMENDATION TO ANY STOCKHOLDER AS TO WHETHER TO TENDER ALL OR ANY SHARES.
Additional copies of the enclosed materials may be obtained from the Information Agent at the appropriate address and telephone number set forth in the Fund’s Offer to Purchase. Any questions you have with respect to the Offer should be directed to the Information Agent at its address and telephone numbers set forth in the Offer to Purchase.
| Very truly yours, |
| THE KOREA FUND, INC. |
|
| JULIAN REID |
| Chairman of the Board of Directors |
Nothing contained herein or in the enclosed documents shall constitute you or any other person the agent of The Korea Fund, Inc. or the Depositary/Information Agent or authorize you or any other person to make any statements or use any material on their behalf with respect to the Offer, other than the material enclosed herewith and the statements specifically set forth in such material.
Exhibit (a)(1)(iv)
OFFER BY
THE KOREA FUND, INC.
TO PURCHASE FOR CASH UP TO 12.5% OF ITS COMMON SHARES OF BENEFICIAL INTEREST FOR 98.5% OF NET ASSET VALUE
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON SEPTEMBER 16, 2024 (“EXPIRATION DATE”), UNLESS EXTENDED
THIS OFFER IS NOT CONDITIONED ON ANY MINIMUM NUMBER OF SHARES BEING TENDERED, BUT IS SUBJECT TO OTHER CONDITIONS AS OUTLINED IN THE OFFER TO PURCHASE AND IN THE LETTER OF TRANSMITTAL.
August 16, 2024
To Our Clients:
Enclosed for your consideration is the Offer to Purchase, dated August 16, 2024, of The Korea Fund, Inc. (the “Fund”), and a related Letter of Transmittal. Together these documents constitute the “Offer.” The Fund is offering to purchase up to 12.5% of its outstanding common shares of beneficial interest, par value $0.01 (the “Shares”), upon the terms and subject to the conditions set forth in the Offer.
A tender of your Shares can be made only by us as the registered holder and only pursuant to your Instructions. The Offer to Purchase and the Letter of Transmittal are being sent to you for your information only. They cannot be used by you to tender Shares held by us for your account. We are the registered holder of Shares held for your account.
Your attention is called to the following:
| (1) | The purchase price to be paid for the Shares is an amount per Share, net to the seller in cash, equal to 98.5% of the net asset value per Share (the “NAV”) in U.S. dollars per Share as determined by the Fund as of the close of ordinary trading on the New York Stock Exchange (“NYSE”) on September 16, 2024, or if the Offer period is extended, as of the close of ordinary trading on the NYSE on the newly designated expiration date. The current NAV of the Fund will be calculated daily and may be obtained by calling EQ Fund Solutions, the Information Agent, toll free at (877) 361-7964. |
| (2) | The Offer is not conditioned upon any minimum number of Shares being tendered. |
| (3) | Upon the terms and subject to the conditions of the Offer, the Fund will purchase all Shares validly tendered (and not withdrawn) on or prior to the Expiration Date, provided that the total number of Shares tendered does not exceed 12.5% of the Fund’s outstanding Shares. In the event that more than 12.5% of the Fund’s outstanding Shares are tendered, the Fund will purchase 12.5% of the Fund’s outstanding Shares on a pro rata basis. |
| (4) | Tendering shareholders will not be obligated to pay stock transfer taxes on the purchase of Shares by the Fund pursuant to the Offer, except in the instances described in Section 4, “Payment for Shares,” of the Offer to Purchase. |
| (5) | Your instructions to us should be forwarded in ample time before the Expiration Date to permit us to submit a tender on your behalf. |
If you wish to have us tender any or all of your Shares, please so instruct us by completing, executing and returning to us the instruction form set forth below. An envelope to return your instructions to us is enclosed. If you authorize the tender of your Shares, all such Shares will be tendered unless otherwise specified below. Your instructions to us should be forwarded as promptly as possible in order to permit us to submit a tender on your behalf in accordance with the terms and conditions of the Offer.
The Offer is not being made to, nor will tenders be accepted from or on behalf of, holders of Shares in any jurisdiction in which the making or acceptance of the Offer would not be in compliance with applicable law.
Neither the Fund nor its Board of Directors is making any recommendation to any stockholder whether to tender or refrain from tendering Shares in the Offer. Each shareholder is urged to read and evaluate the Offer and accompanying materials carefully.
INSTRUCTIONS
The undersigned acknowledge(s) receipt of our letter, the enclosed Offer to Purchase dated August 16, 2024, and the Letter of Transmittal, relating to the Fund’s purchase of up to 12.5% of its outstanding Shares at 98.5% of the NAV.
The undersigned instructs us to tender to the Fund the number of Shares indicated below (which are held by us for the account of the undersigned), upon the terms and subject to the conditions set forth in the Offer to Purchase and in the related Letter of Transmittal that we have furnished to the undersigned.
AGGREGATE NUMBER OF SHARES TO BE TENDERED:
☐ All Shares held for the undersigned;
Or
☐ Shares (Enter number of Shares to be tendered).
| PLEASE SIGN HERE | ||||||
| Dated: | , 2024 | |||||
| Name(s): |
| |||||
| (please print) | ||||||
| Address: |
| |||||
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| City | State | Zip Code | ||||
| Area Code and Telephone Number: | ||||||
| Employer Identification or Social Security Number: | ||||||
Exhibit (a)(1)(v)
NOTICE OF GUARANTEED DELIVERY
Regarding the Offer to Purchase by
THE KOREA FUND, INC.
To Purchase for Cash Up
to 12.5% of its Common Shares as of
August 16, 2024 – 604,144 shares of
Beneficial Interest for 98.5% of the Net Asset Value Per Share
This form must be used to accept the Offer to Purchase (as defined below) if a shareholder’s certificates for Shares are not immediately available or if time will not permit the Letter of Transmittal and other required documents to reach the Depositary on or before the Expiration Date, as defined in Section 1 of the Offer to Purchase. Each term used in this form that is not otherwise defined herein shall have the meaning in the Offer to Purchase, dated August 16, 2024. This form may be delivered by overnight courier or mail or transmitted by facsimile transmission to the Depositary. Tenders using this form may be made only by or through an Eligible Guarantor as defined in Section 2B. of the Offer to Purchase.
The Depositary:
Equiniti Trust Company, LLC
| By Mail: | By Hand, Express Mail, Courier, or Other Expedited Service: | |||
| Equiniti Trust Company, LLC Operations Center P.O. Box 525 Ridgefield Park, New Jersey 07660 Attn: Reorganization Department |
Equiniti Trust Company, LLC 55 Challenger Road Suite # 200 Ridgefield Park, New Jersey 07660 Attn: Reorganization Department | |||
| Toll Free: | ||||
| (877) 248-6417 or (718) 921-8317 |
DELIVERY OF THIS INSTRUMENT TO AN ADDRESS OR TRANSMISSION OF INSTRUCTIONS VIA A FACSIMILE NUMBER OTHER THAN AS SET FORTH ABOVE DOES NOT CONSTITUTE VALID DELIVERY.
Ladies and Gentlemen:
The undersigned hereby tenders to The Korea Fund, Inc. (the “Fund”), upon the terms and subject to the conditions set forth in its Offer to Purchase, dated August 16, 2024, and the related Letter of Transmittal (which together with any amendments or supplements thereto collectively constitute the “Offer to Purchase”), receipt of which are hereby acknowledged, (i) the number of Shares specified below pursuant to the guaranteed delivery procedures set forth in Section 2D. of the Offer to Purchase and (ii) all Shares held in the name(s) of the registered holder(s) by the Fund’s transfer agent pursuant to the Fund’s dividend reinvestment plan.
(Please Print Except for Signature(s))
|
Number of Shares Tendered: |
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Certificate Nos. (if available): |
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Name(s) of Record Holder(s): |
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DTC Participant Number: |
||
If Shares will be tendered by book-entry transfer, check box:
|
☐ The Depository Trust Company | ||
|
Dated: , 2024 | ||
| Individual(s) | ||
| Signature(s) | ||
| Entity: | ||
| Name of Firm: | ||
| Authorized Signature: | ||
| Name: | ||
| Title: | ||
GUARANTEE
The undersigned, an Eligible Guarantor as defined in Section 2B. of the Offer to Purchase, hereby, with respect to the Shares tendered hereby pursuant to the guaranteed delivery procedures set forth in Section 2D. of the Offer to Purchase: (a) represents that the person(s) named on the previous page “own(s)” such Shares within the meaning of Rule 14e-4 under the Securities Exchange Act of 1934, as amended (“Rule 14e-4”); (b) represents that the tender of such Shares complies with Rule 14e-4; and (c) guarantees to deliver to the Depositary certificates representing such Shares, in proper form for transfer (or to tender Shares pursuant to the procedure for book-entry transfer into the Depositary’s account at The Depository Trust Company if so specified on the foregoing page), together with a properly completed and duly executed Letter of Transmittal with any required signature guarantees and any other required documents prior to 5:00 p.m., Eastern Time, within one New York Stock Exchange trading day after the date of receipt of this Guarantee.
(Please Print Except for Signature)
| Name of Firm: | ||
| Authorized Signature: | ||
| Name: | ||
| Title: | ||
| Addresses: | ||
| (Include Zip Code) | ||
| Telephone Number: | ||
| (Include Area Code) | ||
Exhibit (a)(1)(vi)
Instructions for Withdrawal
of
Previously Tendered Common Shares of Beneficial Interest
of
The Korea Fund, Inc.
If you tendered to The Korea Fund, Inc., a Maryland corporation (the “Fund”), in connection with the offer by the Fund to purchase for cash up to 12.5% of its outstanding common shares of beneficial interest, par value $0.01 per share (the “Common Shares”) (the “Offer”), upon the terms and subject to the conditions set forth in the Offer to Purchase dated August 16, 2024 and the related Letter of Transmittal, and you wish to withdraw your tender of all or any of your Common Shares, please fill out the attached Notice of Withdrawal. If your Common Shares are registered in the name of your broker, dealer, commercial bank, trust company or other nominee (“Nominee Holder”), contact that Nominee Holder to withdraw your tendered Common Shares.
1. Withdrawal. If you have tendered your Common Shares pursuant to the Offer, you may withdraw your Common Shares previously tendered by completing, executing and sending the attached “Notice of Withdrawal” to any one of the addresses set forth on the first page of the Notice of Withdrawal. If your Common Shares are registered in the name of your broker or other Nominee Holder, contact that Nominee Holder to withdraw your tendered Common Shares.
2. Delivery of Notice of Withdrawal. Equiniti Trust Company LLC (the “Depositary”) must receive the Notice of Withdrawal prior to 5:00 p.m., New York City time, on September 16, 2024 (the “Expiration Date”), which is the expiration date of the Offer. The method of delivery of any documents related to a withdrawal is at the option and risk of the withdrawing holder of Common Shares. Any documents related to a withdrawal will be deemed delivered only when actually received by the Depositary. If delivery is by mail, registered mail with return receipt requested, properly insured, is recommended. In all cases, sufficient time should be allowed to ensure timely delivery. If your Common Shares are registered in the name of your broker or other Nominee Holder, you may need to allow such Nominee Holder additional time to withdraw your tendered Common Shares on or before the Expiration Date. You should consult your broker or other Nominee Holder to determine if there is an earlier deadline by which you must inform such Nominee Holder of any decision to withdraw your tendered Common Shares.
3. Procedures and Signature Guarantee. The Notice of Withdrawal must specify the name of the person who tendered the Common Shares to be withdrawn, the number of Common Shares to be withdrawn and the name of the registered holder of Common Shares, if different from that of the person who tendered such Common Shares. If the Common Shares to be withdrawn have been delivered to the Depositary, a signed notice of withdrawal (or, in the case of Common Shares tendered by book-entry transfer, an Agent’s Message (as defined in the Offer to Purchase)) with (except in the case of Common Shares tendered by an Eligible Institution (as defined below)) signatures guaranteed by an Eligible Institution must be submitted prior to the release of such Common Shares. In addition, such notice must specify, in the case of Common Shares tendered by Direct Registration System transaction, the name of the registered holder (if different from that of the tendering holder of Common Shares) and the number of Common Shares to be withdrawn or, in the case of Common Shares tendered by book-entry transfer, the name and number of the account at The Depository Trust Company (the “Book-Entry Transfer Facility”) to be credited with the withdrawn Common Shares. An “Eligible Institution” is a financial institution (including most banks, savings and loan associations and brokerage houses) that is a member of a recognized Medallion Program approved by The Securities Transfer Association Inc., including the Securities Transfer Agents Medallion Program (STAMP). If this Notice of Withdrawal is signed by trustees, executors, administrators, guardians, agents, attorneys -in-fact, officers of corporations or others acting in a fiduciary or representative capacity, such persons should so indicate when signing, should indicate location of signing and must submit proper evidence satisfactory to the Fund of their authority to so act.
NOTICE OF WITHDRAWAL
of Common Shares of Beneficial Interest
of
The Korea Fund, Inc.
Previously Tendered
Pursuant to the Offer to Purchase Dated August 16, 2024
THE WITHDRAWAL DEADLINE IS 5:00 P.M., NEW YORK CITY TIME,
ON MONDAY, SEPTEMBER 16, 2024, UNLESS EXTENDED
This Notice of Withdrawal is Submitted to:
Equiniti Trust Company, LLC
| By Mail: | By Registered, Certified or Express Mail or Overnight Courier: | |||
| Equiniti Trust Company, LLC Operations Center P.O. Box 525 Ridgefield Park, New Jersey 07660 Attn: Reorganization Department |
Equiniti Trust Company, LLC 55 Challenger Road, Suite # 200 Ridgefield Park, New Jersey 07660 Attn: Reorganization Department |
| DESCRIPTION OF COMMON SHARES WITHDRAWN* | ||||||
| Name(s) and Address(es) of Registered Holder(s) (Please fill in, if blank, exactly as name(s) appear(s) on your Direct Registration Account(s)) |
Common Shares Withdrawn** (Please check appropriate box below) | |||||
| 1. 2. |
All Partial |
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| Number of Common Shares Withdrawn: | ||||||
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* Need not be completed by holders of Common Shares withdrawing by book-entry transfer. **Unless otherwise indicated, it will be assumed that all Common Shares held in Direct Registration System, including any Common Shares held in the Fund’s distribution reinvestment plan (“DRIP”), are being withdrawn. | ||||||
This Notice of Withdrawal is to be completed if you tendered common shares of beneficial interest, par value $0.01 per share (the “Common Shares”), of The Korea Fund, Inc., a Maryland corporation, in connection with its offer to purchase for cash up to 12.5% of its outstanding Common Shares and wish to withdraw some or all of the Common Shares tendered.
| ☐ | CHECK HERE IF YOUR COMMON SHARES WERE TENDERED PURSUANT TO A NOTICE OF GUARANTEED DELIVERY PREVIOUSLY SENT TO THE DEPOSITARY AND COMPLETE THE FOLLOWING. PLEASE ENCLOSE A PHOTOCOPY OF SUCH NOTICE OF GUARANTEED DELIVERY. |
Name(s) of Registered Holder(s):
Window Ticket No. (if any):
Date of Execution of Notice of Guaranteed Delivery:
Name of Institution which Guaranteed Delivery:
Signatures are required on the next page.
NOTE: SIGNATURE(S) MUST BE PROVIDED BELOW.
PLEASE READ THE INSTRUCTIONS SET FORTH IN THIS
NOTICE OF WITHDRAWAL CAREFULLY.
| Signature(s) of Owner(s): |
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| Date: | , 2024 | |
| Printed Names: |
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| Capacity and Location Signed: |
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| Address: | ||
Guarantee of Signature(s)
(Required if Common Shares have been delivered to the Depositary)
[For use by financial institutions only. Place medallion guarantee in space below.]
Exhibit (a)(5)(i)
The Korea Fund, Inc. Issues Further Update Regarding Tender Offer
NEW YORK -- (BUSINESS WIRE) -- July 10, 2024
As previously reported, the Board of Directors (the “Board”) of The Korea Fund, Inc. (NYSE: KF) (the “Fund”) announced on December 3, 2020 that it had adopted a policy (the “Tender Offer Policy”) pursuant to which the Board will cause the Fund to conduct an issuer tender offer for up to twenty-five percent (25%) of its then issued and outstanding shares of common stock on or before September 30, 2024, and thereafter on each third year anniversary of September 30, 2024, if the Fund’s total return investment performance measured on a net asset value (“NAV”) basis does not equal or exceed the total return investment performance of the MSCI Korea 25/50 Index (the “Index”) during the period commencing April 1, 2021 and ending June 30, 2024 (the “Initial Tender Offer Measurement Period” or “ITOM”), and for three-year testing periods thereafter.
As a further update to a press release issued by the Fund on July 1, 2024, the Board announced today that the definitive comparative performance results for the ITOM confirm that the Fund’s NAV total return was marginally less than that of the Index total return during the ITOM. The figures provided by Morningstar, Inc. (“Morningstar”) confirm that, during the Initial Tender Offer Measurement Period, the Fund’s NAV total return was -19.62% and the Fund’s Index total return was -19.30%, such that the Fund underperformed the Index by 0.32% during the ITOM. The Board noted in its deliberations the recent volatility of relative performance in that, through June – the final month of the ITOM, the Fund’s total return investment performance exceeded that of its Index on thirteen (13) of the nineteen (19) business days, and which included the penultimate business day in the ITOM. In addition, the Board noted that the Fund’s NAV total return exceeded that of the Index by 2.21% from January 1, 2021, being the date that the Fund’s current investment adviser, JPMorgan Asset Management (Asia Pacific) Ltd., assumed responsibility for the day-to-day management of the Fund’s portfolio, through the end of the ITOM.
Taking these and other factors into account and in accordance with the Tender Offer Policy, the Board has authorized the Fund to conduct a tender offer to purchase for cash up to 12.5% of the Fund’s issued and outstanding common stock, at a price per share equal to 98.5% of the NAV per share determined on the date the tender offer expires (the “Tender Offer”). As of July 10, 2024, the Fund had 4,833,153 shares of common stock outstanding and net assets of $142.9 million.
Additional terms and conditions of the Tender Offer, including the dates of commencement and expiration, will be set forth in the Fund’s offering materials, which are expected to be filed with the Securities and Exchange Commission (“SEC”) and distributed to common stockholders at such dates to be determined by the Fund’s officers, subject to ratification by the Board. Among other terms, the offering materials will provide that, if more than 12.5% of the Fund’s outstanding common stock is tendered in the Tender Offer, and not withdrawn, the Fund will purchase shares from tendering stockholders on a pro rata basis, such that stockholders cannot be assured that the Fund will purchase all of any individual stockholder’s tendered shares. The offering materials will also provide that the Fund may not accept shares tendered under various circumstances such as overly volatile conditions brought about by extraneous, geopolitical factors that, in the view of the Board, would make it inadvisable to proceed with the Tender Offer.
In connection with the Tender Offer, the Fund will temporarily suspend its common stock repurchase program as of July 10, 2024, until ten business days after the termination of the Tender Offer.
As announced previously, the next performance measurement period under the Tender Offer Policy runs from July 1, 2024, through June 30, 2027.
This announcement is not a recommendation, an offer to purchase or a solicitation of an offer to sell shares of the Fund. The Fund has not yet commenced the Tender Offer described in this release. Any tender offer will be made only by an Offer to Purchase, a related letter of transmittal and other documents that will be filed with the SEC as exhibits to a tender offer statement on Schedule TO and will be available free of charge at the SEC’s website at www.sec.gov. The Funds’ common stockholders should read the Offer to Purchase and Tender Offer statement on Schedule TO and related exhibits when those documents are filed and become available as they will contain important information about the Tender Offer. The Fund will also make available, without charge, the Offer to Purchase and the letter of transmittal.
The Korea Fund, Inc. is a non-diversified, closed-end investment company. The Fund seeks long-term capital appreciation through investing primarily in equity securities trading on the Korean stock exchanges. Its shares are listed on the New York Stock Exchange under the symbol “KF.”
JPMorgan Asset Management (Asia Pacific) Ltd is the Fund’s Investment Adviser. Investment in closed-end funds involves risks. Additional risks are associated with international investing, such as currency fluctuation, government regulations, economic changes and differences in liquidity, which may increase the volatility of an investment in the Fund. Foreign securities markets generally exhibit greater price volatility and are less liquid than the U.S. market. Additionally, this Fund focuses its investments in certain geographical regions, thereby increasing its vulnerability to developments in that region. All of these factors potentially subject the Fund’s shares to greater price volatility. The NAV of the Fund will fluctuate with the value of the underlying securities. Closed-end funds trade on their market value, not NAV, and closed-end funds often trade at a discount to their NAV.
The Fund’s daily New York Stock Exchange closing market price and NAV, as well as other information, including updated portfolio statistics and performance are available at www.thekoreafund.com or by calling the Fund’s stockholder servicing agent at (866) 706 0510.
This press release contains no recommendations to buy or sell any specific securities and should not be considered investment advice of any kind. Past performance is no guarantee of future results and the investment returns generated by the Fund will fluctuate. There can be no assurance the Fund will meet its stated objective. There is no assurance that the market price of the Fund’s shares, either absolutely or relative to NAV, will increase as a result of any share repurchases. In making any investment decision, individuals should utilize other information sources and the advice of their own professional adviser.
Statements made in this release that look forward in time involve risks and uncertainties and are forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such risks and uncertainties include, without limitation, the adverse effect from a decline in the securities markets or a decline in the Fund’s performance, a general downturn in the economy, competition from other companies, changes in government policy or regulation, inability to attract or retain key employees, inability to implement its operating strategy and/or acquisition strategy, and unforeseen costs and other effects related to legal proceedings or investigations of governmental and self-regulatory organizations.
Fund shares are not FDIC-insured and are not deposits or other obligations of, or guaranteed by, any bank. Fund shares involve investment risk, including possible loss of principal.
Contacts
Julian Reid (Chairman of the Board): +44 7768 068 200
Stockholder Servicing Agent: 866 706 0510
The Korea Fund, Inc. www.thekoreafund.com
Exhibit (a)(5)(ii)
The Korea Fund, Inc. Announces Commencement of Tender Offer
NEW YORK, August 16, 2024 – The Korea Fund, Inc. (the “Fund”) (NYSE: KF) announced today that the tender offer (the “Tender Offer”) to purchase for cash up to 12.5% of the Fund’s issued and outstanding common stock, at a price per share equal to 98.5% of the net asset value per share, determined on the date the tender offer expires, will commence on Friday, August 16, 2024 and expire, unless otherwise extended, at 5:00 p.m., New York City Time, on Monday, September 16, 2024.
The Fund’s Board of Directors previously announced its intention to conduct a Tender Offer in a press release dated July 10, 2024.
The terms and conditions of the Tender Offer are set forth in the Issuer Tender Offer Statements and related Letters of Transmittal that have been filed with the Securities and Exchange Commission (SEC).
In connection with the Tender Offer, the Fund temporarily suspended its share repurchase program as of July 10, 2024 until ten business days after the expiration of the Tender Offer.
This announcement is not a recommendation, an offer to purchase, nor a solicitation of an offer to sell shares of the Fund. The Tender Offer is being made only by an Offer to Purchase, a related Letter of Transmittal and other documents, which have been filed with the SEC. Common stockholders of the Fund should read the Offer to Purchase and related exhibits, as they contain important information about the Tender Offer. These and other filed documents are available to investors free of charge both at the website of the SEC at www.sec.gov, and from the Fund. Common stockholders may obtain further information regarding the Tender Offer from EQ Fund Solutions, the Fund’s Information Agent for the Tender Offer, by calling (877) 361-7964.
*********
The Korea Fund, Inc. is a non-diversified, closed-end investment company. The Fund seeks long-term capital appreciation through investing primarily in equity securities trading on the Korean stock exchanges. Its shares are listed on the New York Stock Exchange under the symbol “KF.”
JPMorgan Asset Management (Asia Pacific) Ltd is the Fund’s Investment Adviser. Investment in closed-end funds involves risks. Additional risks are associated with international investing, such as currency fluctuation, government regulations, economic changes and differences in liquidity, which may increase the volatility of an investment in the Fund. Foreign securities markets generally exhibit greater price volatility and are less liquid than the U.S. market. Additionally, this Fund focuses its investments in certain geographical regions, thereby increasing its vulnerability to developments in that region. All of these factors potentially subject the Fund’s shares to greater price volatility. The NAV of the Fund will fluctuate with the value of the underlying securities. Closed-end funds trade on their market value, not NAV, and closed-end funds often trade at a discount to their NAV.
The Fund’s daily New York Stock Exchange closing market price and NAV, as well as other information, including updated portfolio statistics and performance are available at www.thekoreafund.com or by calling the Fund’s stockholder servicing agent at (866) 706 0510.
Statements made in this release that look forward in time involve risks and uncertainties and are forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such risks and uncertainties include, without limitation, the adverse effect from a decline in the securities markets or a decline in the Fund’s performance, a general downturn in the economy, competition from other companies, changes in government policy or regulation, inability to attract or retain key employees, inability to implement its operating strategy and/or
acquisition strategy, and unforeseen costs and other effects related to legal proceedings or investigations of governmental and self-regulatory organizations.
This announcement is not an offer to purchase or the solicitation of an offer to sell shares of the Fund or a prospectus, circular or representation intended for use in the purchase or sale of Fund shares.
Fund shares are not FDIC-insured and are not deposits or other obligations of, or guaranteed by, any bank. Fund shares involve investment risk, including possible loss of principal.
Contacts
Julian Reid (Chairman of the Board): +44 7768 068 200
Stockholder Servicing Agent: 866 706 0510
The Korea Fund, Inc. www.thekoreafund.com