Tufton Oceanic Assets : ADOPTION OF NEW ARTICLES OF INCORPORATION TO PERMIT FUTURE RETURNS OF CAPITAL BY WAY OF COMPULSORY REDEMPTIONS

177179      Proof 2 Friday, May 17, 2024 16:25

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

If you have sold or otherwise transferred all of your Shares in Tufton Oceanic Assets Limited (the "Company") please send this document (but not the accompanying personalised Form of Proxy) at once to the purchaser or transferee or to the stockbroker, bank or other person through whom the sale or transfer was effected, for onward transmission to the purchaser or transferee. However, this document should not be distributed, forwarded or transmitted in or into the United States, Canada, Australia, South Africa or Japan or into any other jurisdiction if to do so would constitute a violation of applicable laws and regulations in such other jurisdiction. If you have sold or otherwise transferred only part of your holding, you should retain these documents.

The Proposals described in this Circular are conditional on the approval of Shareholders. This document should be read as a whole. Your attention is drawn to the letter from the Chairman of the Company, set out on pages 5 to 11 of this Circular, which contains the recommendation of the Directors that you vote in favour of the Resolutions to be proposed at the Extraordinary General Meeting referred to below.

The definitions used in this document are set out on pages 22 to 24.

TUFTON OCEANIC ASSETS LIMITED

(a closed-ended investment company limited by shares incorporated under the laws of Guernsey with

registered number 63061)

RECOMMENDED PROPOSALS FOR

ADOPTION OF NEW ARTICLES OF INCORPORATION TO PERMIT

FUTURE RETURNS OF CAPITAL BY WAY OF COMPULSORY REDEMPTIONS

AMENDMENT TO INVESTMENT POLICY

AND

NOTICE OF EXTRAORDINARY GENERAL MEETING

All Shareholders are requested to complete and return their Form(s) of Proxy. To be valid, Forms of Proxy for use at the Extraordinary General Meeting must be completed and returned in accordance with the instructions printed thereon to Computershare Investor Services (Guernsey) Limited, c/o The Pavilions, Bridgwater Road, Bristol BS99 6ZY, or delivered by hand during office hours only to Computershare Investor Services (Guernsey) Limited, c/o The Pavilions, Bridgwater Road, Bristol BS99 6ZY, or in the case of Shares held through CREST, via the CREST system or if submitting the proxy vote electronically, via the Registrar's website, by no later than 11.00 a.m. on 7 June 2024.

Shareholders should make their own investigations in relation to the Proposals, including the merits and risks involved. Nothing in this document constitutes legal, tax, financial or other advice, and if they are in any doubt about the contents of this document, Shareholders should consult their own professional advisers.

The Company is registered with the Guernsey Financial Services Commission ("GFSC") under the Registered Collective Investment Scheme Rules and Guidance, 2021 and the Protection of Investors (Bailiwick of Guernsey) Law, 2020, as amended. Neither the GFSC nor the States of Guernsey take any responsibility for the financial soundness of the Company or for the correctness of any of the statements made or opinions expressed with regard to it.

Your attention is drawn to the sections entitled "Risk Factors" on pages 12 to 13 and "Action to be taken by Shareholders" on page 10 of this document.

177179      Proof 2 Friday, May 17, 2024 16:25

Forward-looking statements

This Circular contains (or may contain) statements that are, or may be deemed to be, "forward-looking statements". Forward-looking statements are based on current expectations and projections about future events and other matters that are not historical fact. These forward-looking statements are sometimes identified by the use of a date in the future or forward-looking terminology, including, but not limited to, the words "aim", "anticipate", "believe", "intend", "plan", "estimate", "expect", "may", "target", "project", "will", "could" or "should" or, in each case, their negative or other variations or words of similar meaning. These forward-looking statements include matters that are not historical facts and include statements that reflect the Directors' intentions, beliefs and current expectations. By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future or are beyond the Company's control. They are not guarantees of future performance and are based on one or more assumptions.

Statements contained in this Circular regarding past trends or activities should not be taken as a representation that such trends or activities will continue in the future.

Forward-looking statements contained in this Circular apply only as at the date of this Circular. Subject to any obligations under the Disclosure Guidance and Transparency Rules or those of the Listing Rules with which the Company voluntarily complies, or any other applicable law or regulation, the Company undertakes no obligation publicly to update or review any forward-looking statement, whether as a result of new information, future developments or otherwise.

2

177179      Proof 2 Friday, May 17, 2024 16:25

	CONTENTS
		Page
EXPECTED TIMETABLE	4
PART 1 LETTER FROM THE CHAIRMAN	5
PART 2	RISK FACTORS	12
PART 3	COMPULSORY REDEMPTION OF SHARES AND RELATED CHANGES TO
	THE ARTICLES	14
PART 4	AMENDMENT TO INVESTMENT RESTRICTIONS TO ALIGN WITH MARKET
	OPPORTUNITIES	17
PART 5	TAXATION	20
DEFINITIONS	22
GLOSSARY	25
NOTICE OF EXTRAORDINARY GENERAL MEETING	26

3

	177179      Proof 2 Friday, May 17, 2024 16:25
EXPECTED TIMETABLE
Publication of this Circular	Monday, 20 May 2024
Latest time and date for receipt of the Forms of Proxy or
transmission of CREST Proxy Instructions for the EGM	11.00 a.m. on Friday, 7 June 2024
Record date for entitlement to vote at the EGM	6.00 p.m. on Friday, 7 June 2024
Extraordinary General Meeting	11.00 a.m. on Tuesday, 11	June 2024
Announcement of results of EGM	Tuesday, 11	June 2024
Effective date of change of Investment Policy	11	June 2024

If any of the above times and/or dates change, the revised time(s) and/or date(s) will be notified to Shareholders by an announcement through a Regulatory Information Service. All references to times in this document are to London time.

4

177179      Proof 2 Friday, May 17, 2024 16:25

PART 1

LETTER FROM THE CHAIRMAN

TUFTON OCEANIC ASSETS LIMITED

(a closed-ended investment company limited by shares incorporated under the laws of Guernsey with

registered number 63061)

Directors:	Registered Office:
Robert King (Non-Executive Chairman)	1 Royal Plaza
Steve Le Page (Non-Executive Director)	Royal Avenue
Paul Barnes (Non-Executive Director)	St Peter Port
Christine Rødsæther (Non-ExecutiveDirector)	GY1 2HL
Katriona Le Noury (Non-Executive Director)	Guernsey
	20 May 2024

Recommended proposals for (a) adoption of New Articles of Incorporation to permit future returns of capital by way of compulsory redemptions, and

(b) amendment to investment restrictions to align with market opportunities

and

Notice of Extraordinary General Meeting

Dear Shareholder

1. Introduction

The Company announced the results of its strategy review on 17 January 2024. As part of the review the Board considered its capital allocation policy and use of investible cash and, inter alia, the Company announced:

• the Board was evaluating a proposed one-off return of capital in 2Q24 representing between 5 per cent. and 10 per cent. of NAV at a price representing the prevailing Net Asset Value per Share less attributable costs; and
• the Board will annually evaluate further returns of capital using excess investible cash if no suitable investment opportunities are presented.

In accordance with the Investment Manager's recommendations, the Board determined to divest all Containerships by early 2023, thereby reducing the number of shipping Segments (i.e. Tankers, General Cargo, Containerships and Bulkers) the Company is currently invested in to two (being Bulkers and Tankers). The Existing Investment Policy restricts the Company from making new investments that would result in any shipping Segment accounting for more than 50 per cent. of Net Asset Value. After careful consideration and consultation with the Investment Manager, the Board is recommending that the Existing Investment Policy be amended to ease the above investment restriction to enable the Investment Manager to propose investments the Investment Manager believes will maximise investor returns in a manner that is still consistent with the objective of diversifying investment risk across shipping Segments. The proposed amendments to the Existing Investment Policy are set out in full in Part 4 of this document, and the rationale for them is set out in section 2 of this Part 1 below.

This Circular:

• provides fuller details in respect of the terms of the one-off return of capital referred to above;
• contains a proposal for the adoption of New Articles which will provide for the periodic Compulsory Redemption of the Company's Shares (excluding those held in treasury) at the discretion of the Directors to allow excess investible cash to be returned to Shareholders (the "Compulsory Redemption Proposal"); and

5

177179      Proof 2 Friday, May 17, 2024 16:25

• contains a proposal to amend the Company's Existing Investment Policy (the "Investment Policy Amendment Proposal"),

(the Compulsory Redemption Proposal and the Investment Policy Amendment Proposal, together, the "Proposals").

The adoption of the New Articles to permit the Compulsory Redemption of the Company's Shares requires Shareholder approval, pursuant to the Companies Law, by way of a special resolution.

The proposed amendments to the Company's Existing Investment Policy are considered to be a material change, which requires Shareholder approval by way of ordinary resolution. The Company's investment objective remains unchanged.

Accordingly, the Board is publishing this Circular to convene the Extraordinary General Meeting at which it will seek approval from Shareholders to: (a) adopt the New Articles to facilitate returns of capital; and (b) adopt the New Investment Policy.

This Circular sets out details of, and seeks your approval for, the Proposals and explains why the Board is recommending that you vote in favour of the Resolutions to be proposed at the Extraordinary General Meeting to be held at 11.00 a.m. on Tuesday, 11 June 2024. Approval of the Compulsory Redemption Proposal is not conditional on approval of the Investment Policy Amendment Proposal and approval of the Investment Policy Amendment Proposal is not conditional on approval of the Compulsory Redemption Proposal.

Notice of the EGM is set out at the end of this Circular. The Proposals are described in paragraphs 2, 4 and 5 of this Part 1 and in Parts 3 and 4 of this Circular.

2. Background to, and reasons for, the Proposals

The Compulsory Redemption Proposal

The Compulsory Redemption Proposal follows a review of the Company's strategy, advice sought from its advisers and consultation with certain Shareholders.

Strategy Review

Since its IPO in December 2017, the Company has delivered strong results in line with its original objectives, despite the very challenging economic and operational backdrop during Covid, ongoing geopolitical events and the impact of inflation.

As announced on 17 January 2024, in light of the ongoing share price discount to NAV and the Company's forthcoming continuation vote at the annual general meeting to be held in October 2024, the Board, in consultation with the Investment Manager and other advisers, has undertaken a review of the Company's strategy and capital allocation policy.

The outcome of the review, as announced on 17 January 2024, is set out below.

Continuing Investment Opportunity

The Investment Manager anticipates the investment opportunity set for fuel-efficient,second-hand vessels to be very strong for the next decade as the shipping industry slowly transitions towards zero carbon fuels to meet tightening regulations and decarbonisation targets. The Board and the Investment Manager believe that strong supply-side fundamentals will continue to support high yields and second-hand values, resulting in future IRRs being higher than the Company's published target.

The Board therefore believes the correct strategy for the Company over the medium term, through to 2030, is to continue investing in fuel-efficient,second-hand vessels to maximise Shareholder returns, intending to realise the Company's portfolio of assets starting from 2028, well before the decarbonisation of shipping accelerates.

Continuation votes will be held as planned in 2024 and 2027 to reconfirm the opportunity set and the strategy with Shareholders, before the realisation period starting in 2028.

6

177179      Proof 2 Friday, May 17, 2024 16:25

Revised Capital Allocation Policy

Acknowledging investor feedback and the current discount to NAV, the Board has also considered its capital allocation policy and use of investible cash as follows:

• With effect from the first quarter of 2024, the Company's annual target dividend was increased by c.17.6 per cent. from $0.085/share to $0.10/share1. Based on this increased target the Company is forecast to have a dividend cover of c.1.5x over the 18 months from 31 December 2023.
• The Board was evaluating a proposed one-off return of capital in 2Q24 representing between 5 per cent. and 10 per cent. of NAV at a price representing the prevailing Net Asset Value per Share less attributable costs.
• The Company sees fleet renewal (based on age, technology, and sector outlook) as a priority. Returns from all new asset investments over a three-year holding period will be compared to the benefit from a return of capital given the prevailing Share price at the time of the proposed investment and medium-term market outlook.
• The Board will annually evaluate a further return of capital using excess investible cash if no suitable investment opportunities are presented.
• The current buy-back policy is to remain in place (excess cash may be used, at the discretion of the Directors, to repurchase Shares should they trade at greater than a 10 per cent. discount to NAV, as set out in the Company's listing documents).

To facilitate the return of capital to Shareholders, the Directors are proposing that the New Articles be adopted to permit the Compulsory Redemption of the Company's Shares (excluding those held in treasury).

Should the Compulsory Redemption Proposal be approved by Shareholders, the Directors will be able to return capital to Shareholders in a cost-effective and timely manner through the Compulsory Redemption mechanism in accordance with the revised capital allocation policy.

The Investment Policy Amendment Proposal

The Existing Investment Policy restricts the Company from making new investments that would result in any shipping Segment (i.e. Tankers, General Cargo, Containerships and Bulkers) accounting for more than 50 per cent. of Net Asset Value.

After careful consideration and consultation with the Investment Manager, the Board is recommending that the Existing Investment Policy be amended to ease the above investment restriction to enable the Investment Manager to propose investments the Investment Manager believes will maximise investor returns in a manner that is still consistent with the objective of diversifying investment risk across shipping Segments.

The background to the proposed amendment is as follows. In accordance with the Investment Manager's recommendations, the Board determined to divest all Containerships by early 2023, thereby reducing the number of shipping Segments (i.e. Tankers, General Cargo, Containerships and Bulkers) the Company is currently invested in to two (being Bulkers and Tankers). As a consequence of Containership divestments and rising Tanker values, the Company's exposure to a single shipping Segment has exceeded 50 per cent. of Net Asset Value and the Company has been unable to make further investments in the relevant shipping Segment. At the end of Q1 2024 Tankers accounted for 56.5 per cent. of Net Asset Value.

• This is a target only and there can be no assurance that the target can or will be met and it should not be taken as an indication of the Company's expected or actual future results. Accordingly, potential investors should not place any reliance on this target in deciding whether to invest in the Company or assume that the Company will make any distributions at all and should decide for themselves whether the target dividend yield is reasonable or achievable.

7

177179      Proof 2 Friday, May 17, 2024 16:25

The Board, as advised by the Investment Manager, believes that:

• the Company's strategy of low leverage and high Charter coverage continues to limit volatility;
• the Company's Tanker Segment exposure is diversified in sub-segments such as 'Gas Tankers', 'Product Tankers' and 'Chemical Tankers' which have different supply/demand drivers; and
• at various times, fundamentals in certain Segments may not support new investments: for example, despite current good yields in the Containership Segment, fundamentals suggest near-term risk to residual values.

The proposed amendments to the Existing Investment Policy are described in further detail in paragraph 5 of this Part 1 and set out in full in Part 4 of this document below.

3. One-off return of capital

On 11 January 2024, the Company announced that it had agreed to sell two Handysize Product Tankers, Pollock and Dachshund, for a total of $41.75m, which represented a 3.1 per cent. premium to the two vessels' 31 December 2023 net asset value of $40.50m (the "Disposals"), being the latest available Net Asset Value prior to the announcement. Following receipt of the proceeds from the Disposals, the Board intends to return $31.5m to Shareholders by way of a one-off Compulsory Redemption (as defined below), subject to Shareholder approval of the Compulsory Redemption Proposal. This return of capital is net of costs and expenses incurred by the Company relating to the approval of the Proposals and implementing the Compulsory Redemption.

The Compulsory Redemption will be priced at the attributable Net Asset Value per Share as at 30 June 2024. The Board expects to announce the Company's NAV as at 30 June 2024 on or around 17 July

2024. Subject to the Company having received the proceeds from the Disposals, a timetable for the Compulsory Redemption will be released simultaneously with the NAV announcement on 17 July 2024. The Board currently expects that settlement of the Compulsory Redemption will be in early August 2024.

For the avoidance of doubt, the record date for the Company's quarterly dividend to the 3 months ending 30 June 2024 (the "2Q24 Dividend") will precede the Redemption Record Date. Accordingly, Shareholders will be eligible to receive both the 2Q24 Dividend and proceeds from the Compulsory Redemption on the basis they continue to own shares on each of the 2Q24 Dividend record date and the Redemption Record Date.

4. Change of Articles, returns of capital and Compulsory Redemptions of Shares

As set out above, the Board is intending to make a one-off return of capital following receipt of the proceeds from the Disposals and will annually evaluate further returns of capital using excess investible cash if no suitable investment opportunities are presented.

The Directors propose to effect any such returns of capital to Shareholders by way of redemptions of Shares (excluding those held in treasury) compulsorily (each a "Compulsory Redemption"). Currently the Company's Shares are non-redeemable. Accordingly, it will first be necessary to change the Company's existing Articles to permit the Directors, at their sole discretion, to effect a Compulsory Redemption of Shares on an ongoing basis, and pro rata to each Shareholder's shareholding in the Company, in order to return capital to Shareholders. Upon the New Articles being adopted, the Directors shall convert the Shares into redeemable shares, redeemable on the terms set out in the New Articles.

For any Compulsory Redemption undertaken after the Compulsory Redemption in relation to the Disposals, the Redemption Price per Share is expected to be calculated by reference to the NAV per Share less the costs associated with the relevant redemption and adjusted as the Directors consider appropriate. The number of Shares to be redeemed will be redeemed from all Shareholders pro rata to their Shareholdings on the relevant Redemption Date. Details of any Compulsory Redemption approved by the Board will be announced to the market by way of an announcement released on a Regulatory Information Service.

The Board believes that the Compulsory Redemption Proposal is in the best interests of the Company and its Shareholders as a whole by giving the Company the ability to return capital to Shareholders in

8

177179      Proof 2 Friday, May 17, 2024 16:25

a cost-effective and timely manner through the proposed Compulsory Redemption mechanism in accordance with the revised capital allocation policy.

Further details regarding the return of capital and the proposed changes to the Articles are set out in Part 3 of this Circular. A summary of certain possible risks associated with each of the Proposals is set out in Part 2 of this Circular. The proposed special resolution to approve the adoption of the New Articles to permit Compulsory Redemptions of the Shares (Resolution 1) is set out in the Notice of EGM at the end of this document.

Details of the tax consequences of the Compulsory Redemption Proposal for certain Shareholders are set out in Part 5 of this Circular.

5. Amendment to investment restrictions to align with market opportunities

The Existing Investment Policy restricts the Company from making new investments that would result in any shipping Segment (i.e. Tankers, General Cargo, Containerships and Bulkers) accounting for more than 50 per cent. of Net Asset Value. The Board is seeking Shareholder approval to ease the above investment restriction such that:

• the restriction on making further investments that would result in a shipping Segment accounting for more than 50 per cent. of Net Asset Value will only apply where the Company is invested in at least three shipping Segments; and
• where the Company is only invested in two shipping Segments: (i) no further investment may be made that results in any shipping Segment accounting for more than 75 per cent. of Net Asset Value; and (ii) if the Tankers shipping Segment accounts for more than 50 per cent. of Net Asset Value and exposure is only to a single Tanker sub-segment (i.e. Crude Tankers, Product Tankers, Chemical Tankers, Gas Tankers), no further investment may be made in such Tankers sub-segment.

The Board believes that the Investment Policy Amendment Proposal is in the best interests of the Company and its Shareholders as a whole as it will enable the Investment Manager to propose investments the Investment Manager believes will maximise investor returns in a manner that is still consistent with the objective of diversifying investment risk across shipping Segments.

The text of the proposed New Investment Policy is set out in Part 4 of this Circular. A summary of certain possible risks associated with the proposed amendment to the Existing Investment Policy is set out in Part 2 of this Circular. The New Investment Policy will only become effective once approved by Shareholders at the Extraordinary General Meeting. The proposed ordinary resolution to change the Investment Policy (Resolution 2) is set out in the Notice of the EGM at the end of this document.

6. Costs of the Proposals

The costs and expenses relating to the approval of the Proposals to be incurred by the Company are estimated to amount to approximately $164,500, representing 0.04 per cent. of the Company's Net Asset Value as at 31 March 2024. It should be noted that the estimated costs and expenses are exclusive of the ongoing costs of running the Company and implementing each Compulsory Redemption.

7. Risk factors

The Directors have given consideration to the potential risks and uncertainties relating to the Proposals.

For a discussion of certain risk factors which Shareholders should take into account when considering whether to vote in favour of the Resolutions, please refer to Part 2 of this Circular.

8. Consent

The Investment Manager has given and has not withdrawn its written consent to the inclusion of the references to its name in the form and context in which they are included in this document.

9

177179      Proof 2 Friday, May 17, 2024 16:25

9. Extraordinary General Meeting

At the end of this Circular, you will find the Notice of EGM, convening an extraordinary general meeting of the Company which is to be held at 1 Royal Plaza, Royal Avenue, St Peter Port, GY1 2HL, Guernsey at 11.00 a.m. on Tuesday, 11 June 2024.

A summary of the action you should take is set out in the paragraph below and in the Form of Proxy that accompanies this Circular.

The Resolutions seek the approval of Shareholders for:

1. the adoption of the New Articles to permit the Directors to undertake Compulsory Redemptions of the Shares at their sole discretion (as described in Part 3 of this Circular); and
2. the amendment to the Existing Investment Policy (the full text of the proposed New Investment Policy is set out in paragraph 1 of Part 4 of this Circular).

The full text of the Resolutions to be proposed at the Extraordinary General Meeting is set out in the Notice of EGM at the end of this Circular. A draft of the proposed New Articles (showing the full terms of the changes proposed to be made) will be available for inspection on the National Storage Mechanism from the date of sending of this Circular and may be inspected at the registered office of the Company, 1 Royal Plaza, Royal Avenue, St Peter Port, GY1 2HL, Guernsey during usual business hours on any weekday (Saturdays, Sundays and public holidays excepted) from the date of this Circular up to and including the date of the Extraordinary General Meeting and at the place of the Extraordinary General Meeting for at least 15 minutes before and during the Extraordinary General Meeting.

Resolution 1 will be proposed as a special resolution and the passing of such Resolution will require a 75 per cent. majority of the votes cast in person or by proxy. Resolution 2 will be proposed as an ordinary resolution and the passing of such Resolution will require a simple majority of the votes cast in person or by proxy.

10. Action to be taken by Shareholders

If you are a Shareholder, you will find enclosed with this document a Form of Proxy for use at the Extraordinary General Meeting.

Whether or not you intend to be present at the EGM, Shareholders are asked to complete and return the Form of Proxy in accordance with the instructions printed thereon to Computershare Investor Services (Guernsey) Limited, c/o The Pavilions, Bridgwater Road, Bristol BS99 6ZY, or deliver it by hand during office hours only to Computershare Investor Services (Guernsey) Limited, c/o The Pavilions, Bridgwater Road, Bristol BS99 6ZY so as to be received as soon as possible and in any event by no later than 11.00 a.m. on 7 June 2024.

Alternatively, Shareholders may submit proxy votes electronically, via the Registrars website, by no later than 11.00 a.m. on 7 June 2024.

If you hold your Shares in uncertificated form (that is, in CREST) you may appoint a proxy by completing and transmitting a CREST Proxy Instruction in accordance with the procedures set out in the CREST manual so that it is received by the Registrar (under CREST participant ID 3RA50) by no later than 11.00 a.m. on 7 June 2024. CREST members may choose to use the CREST electronic proxy appointment service in accordance with the procedures set out in the notes to the Form of Proxy and the Notice of Extraordinary General Meeting.

The completion and return of a Form of Proxy will not preclude you from attending the Extraordinary General Meeting and voting in person if you wish to do so.

11. Further information

Your attention is drawn to the further information set out in Parts 2 to 5 of this Circular. You should read the whole of this Circular and, in particular, the risk factors set out in Part 2, before deciding on the course of action you will take in respect of the Resolutions and the Proposals.

10