nsx announcements today

Debt Update

Wellington Capital Limited as responsible entity for the Premium Income Fund advises that partial

repayment of the current debt has occurred through the partial repayment of the loan secured to the 66 unit

student accommodation sold in Melbourne.

Consequently the current balance of the debt facility of the Premium Income Fund as at 13 March 2009 is

$1 million. Full settlement of the debt is scheduled to occur by the end of March 2009.

Half yearly financial report clarification

Unitholders will note that the half yearly financial report for the period ended 31 December 2008 states that

the funds debt is $5.705 million, whereas the Fund’s 24 December 2008 announcement outlined that the debt

balance was $5 million.

The principal outstanding at 31 December 2008 was $5 million. The debt for accounting purposes however

includes all current and future costs in relation to the facility up to and including its anticipated repayment by

the end of March 2009.

Conclusion

Jenny Hutson, Managing Director, Wellington Capital Limited said ‘I am pleased that the Fund has reached

a situation where the current debt is $1 million and is scheduled to be repaid this month.

The economic environment remains extremely difficult. Wellington Capital Limited as responsible entity of

the Fund continues to pursue all relevant options to ensure that the Fund’s assets are realised at market

value.’

The timing of the proposed cash distribution to Unitholders remains uncertain.

Fund exposure to Raptis Group

Wellington Capital Limited as responsible entity for the Premium Income Fund advises that the Fund has exposure

to Raptis Group Limited (ASX:RPG) through direct loans to subsidiaries of Raptis Group Limited.

As set out in the Fund’s Explanatory Memorandum dated 18 August 2008, the outstanding balance on each of the

three loans as at 31 May 2008 was $52,608,301.

The Fund is mortgagee in possession of the secured property that supports two loans to Raptis subsidiaries where

the Fund has a registered first ranking mortgage in both instances.

The Fund is in discussions with the first mortgagor in relation to the Fund’s asset backed security loan. The Fund

has a second ranking mortgage over this property. External marketing is currently being undertaken in relation to

the underlying asset by the Raptis Group.

Fund Insurance Update

The former responsible entity of the Premium Income Fund (Octaviar Investment Management Limited) arranged

insurance through Lloyd’s Underwriters to cover certain commercial loans in the mortgage portfolio of the

Premium Income Fund. The responsible entity was of the view that not all loan facilities required insurance cover

for example, vacant land loan facilities.

The insurance policy only covers the circumstance where the Fund becomes mortgagee in possession, exercises the

mortgagee’s power of sale and a loss against the insured loan principal is sustained. The insurance policy does not

cover loans where a loss is sustained by the Fund because of refinancing or a change in the terms of the loan

agreement between the Fund and the borrower.

Claims can be made under this policy until 11 April 2009. The policy has been unable to be altered since April

2008 and cannot be renewed.

The following table outlines realisations conducted by the Fund since 2 May 2008:

Property Insured value Eligible to claim Possible claim

on policy

Sylvania, NSW Nil No, not insured. Nil

Hastings Point, NSW $13.084 million No, refinance of borrower. Nil

Brooklyn West, VIC $0.802 million No, refinance of borrower. Nil

Narrabeen, NSW $1.893 million Yes, loss of $393,000 suffered by Fund after

mortgagee in possession sale of secured

property supporting loan.

$393,000

Blacktown, NSW $2.32 million Yes, loss of $52,000 suffered by Fund after

mortgagee in possession sale of secured

property supporting loan.

$52,000

St Leonards, NSW $8.115 million No, legal settlement with borrower. Nil

Seddon, VIC $7.875 million No, sold at premium of $625,000 over insured

value

Nil

Total possible claim on Lloyds insurance policy: $445,000

The Fund could possibly make a total claim for the loss of $445,000 under the Lloyds policy. In order to make this

claim, the Fund would have to pay $1,233,258 in premiums.

Wellington has decided that it is in the best interests of the Fund to make no claim under the policy