General Risk Warning
Before deciding whether to purchase any HighCastle Product (as defined in the Investor Agreement), you need to be aware of the following:
- Our products are not covered by the Financial Services Compensation Scheme
- Investments and income arising from them can go down as well as up
- Risk can be brought about by the performance of the obligors, performance of world markets, interest rates, taxes on income and capital, and foreign exchange rates
- You are not participating directly in the senior secured loans or bonds issued by companies
- There is a risk that the Sellers of the senior secured loans or bonds could default resulting in a loss of your income and capital
- Participations in non-readily realisable securities are illiquid, meaning they are harder to trade, which makes them a higher risk investment than directly held listed investments
- Past performance of an investment is no guide to its performance in the future
- Content and information on the platform about potential investments are designed for general use, and so cannot be considered personal to your circumstances or your financial position
- Before investing you should seek expert independent financial and tax advice
HighCastle Investments Ltd Smart Notes, or “Notes”, issued by HighCastle Investments Ltd are designed to reflect the key terms of a specific loan-based investment or other investment issued by established companies in the United Kingdom and mainland Europe. Corporate loan-based investments typically have maturities of between 3 to 10 years. HighCastle Investments Ltd purchases interests in loans and other investments on the terms outlined in our Investor Agreement. If you hold Notes in your HighCastle Investments Ltd account, HighCastle Investments Ltd will distribute to you your pro rata portion of the principal and interest coupon payments or other distributions, if any, that HighCastle Investments Ltd receives in respect of the corresponding interest it has purchased, net of its 1.00% annual Services Fee that may be allocable to HighCastle Investments Ltd.
Information posted on the platform about investments is taken from publicly available information for each borrower company listed on the platform. Neither HighCastle Group Ltd nor HighCastle Investments Ltd is responsible for the accuracy of this information. The interest and capital payments of HighCastle Investments Ltd’s Notes are not guaranteed or insured and investors may receive back less than the amount invested and there is a risk of losing your investment in its entirety.
You understand and acknowledge that you will hold Notes issued by HighCastle Investments Ltd, not the underlying loans, debt investments or other investments discussed herein. This means you do not have voting rights in respect of any of the underlying loans, debt investments or other investments.
Realised Rate of Return
You understand and acknowledge that the realised rate of return on the Notes will depend on the underlying loan, debt investment or other investment that may vary based on a number of factors which include the movement of LIBOR during the relevant life of the loan, debt investment or other investment or any events which cause the margin on the underlying loans, debt investment or other investments to move up or down or for the principal to become impaired following an event of default or restructuring.
HighCastle Investments Ltd does not pay interest on funds in member accounts (i.e those funds that are within your account but not invested).
Fees and Liquidity
HighCastle Investments Ltd charges you a Services Fee of 1.00% per annum based on the total sum invested in the Notes’ you hold which are outstanding (where the payments on the corresponding loan, debt investment or other investment are up to date). The Services fee is deducted from the coupons paid to you under the Notes.
If you need access to the money you have invested before the scheduled maturity date of a Note, HighCastle Investments Ltd may, at its sole discretion, purchase your Notes, less a 0.25% discount to the prevailing market price. Please note there is no active ‘secondary market’ for the Notes at present and all sales of Notes prior to the maturity date are conducted on a matched bargain basis only.
Counterparty credit risk
Loan investment contracts entered into by HighCastle Investments Ltd may be held under a participation agreement with a counterparty bank (the “Seller”). Such participations in the Seller’s portion of a loan typically result in a contractual relationship only with the Seller and not with the borrowing company under such loan. Consequently, HighCastle Investments Ltd will only be entitled to receive payments of principal and interest to the extent that the Seller has received such payments from the underlying borrower and has remitted payment to HighCastle Investments Ltd. In purchasing participations, HighCastle Investments Ltd generally will have no right to enforce compliance by the borrower with the terms of the relevant loan agreement and HighCastle Investments Ltd may not benefit directly from any security supporting the loan. As a result, HighCastle Investments Ltd will be exposed to the credit risk of both the borrower and the Seller. In the event of the insolvency of the Seller, HighCastle Investments Ltd may be treated as a general creditor of the Seller. When HighCastle Investments Ltd purchases a participation in a loan it also may not have any right to participate directly in any vote to waive enforcement of any loan covenants breached by a borrower.
HighCastle Investments Ltd is a body corporate registered in the BVI. HighCastle Investments Ltd as a body corporate may have other creditors or employ the use of various forms of financing during the course of its operation. In the event that the company suffers an insolvency event investors may be exposed to a risk on the recovery of their Notes.
The HighCastle Investments Ltd Notes are not guaranteed or insured and investors may receive back less than the amount invested and there is a risk of losing your investment in its entirety.
Interest from HighCastle Notes is currently paid to Noteholders without any tax being deducted. Any income you earn from your investments in HighCastle Notes forms part of your overall income that is subject to personal or corporate taxation rules. Interest payable to Noteholders on money invested is charged to income tax in the tax year the interest is received. For example, interest received on 31 December 2016 is received in and taxable for the tax year 2016/17. You should declare any interest and capital gains to the HM Revenue & Customs on a self-assessment tax return if you are an individual or inform your local tax office. At the end of the tax year HighCastle will make available to all investors an Annual Income Statement splitting out the relevant amounts for your tax return, to download from your account. If you are in any doubt about your tax position you should seek independent tax advice
HighCastle Group Ltd operates this platform so that HighCastle Investments Ltd may offer participating notes (“Notes”) which reflect the key economic terms of the underlying corporate loan assets or other investments listed from time to time on the Invest section of this platform. Other entities (“HighCastle Product Issuers”) may in the future adhere to the Investor Agreement and offer other investments through this site (“HighCastle Products”). None of HighCastle Group Ltd, HighCastle Investments Ltd and any applicable HighCastle Product Issuer offers investment advice.
This platform is not directed at or intended for publication or distribution to any person (natural or legal) in any jurisdiction where doing so would result in contravention of any applicable laws or regulations. The platform information does not constitute an offer or solicitation in any jurisdictions in which such an offer or solicitation is not authorised or to any person to whom it is unlawful to make such an offer or solicitation. The information herein is not for distribution and does not constitute an offer to sell or the solicitation of an offer to buy any securities in the United States to or for the benefit of any United States person (being residents of the United States or partnerships or corporations organised under the laws hereof). None of the products listed on this site have been registered in the United States under the Investment Company Act of 1940 and interests therein are not registered in the United States under the Securities Act of 1933. Prospective investors should take appropriate independent investment advice and inform themselves as to applicable legal requirements, exchange control regulations and taxes in the countries of their citizenship, residence or domicile.
The value of Notes and HighCastle Products, and any income from or relating to them, can fall as well as rise so you could receive less than you invest or even nothing at all. Past performance is no guarantee of future performance. Our products are not deposit based or capital protected and your capital risk of loss. They are also illiquid, high risk and are not covered by the Financial Services Compensation Scheme. The interest rate on our products is not comparable to that of a bank savings account.
Tax treatment depends on your individual circumstances and may be subject to change. If in any doubt, please seek specialist tax advice. This platform does not constitute investment, legal, tax or other advice nor is it to be relied upon in making an investment decision. The information contained herein has been taken from sources considered by HighCastle Group Ltd, HighCastle Investments Ltd and any applicable HighCastle Product Issuer to be reliable but no warranty is given that such information is accurate or complete and it should not be relied upon as such. HighCastle Group Ltd, HighCastle Investments Ltd and any applicable HighCastle Product Issuer will not be responsible for any loss or damage of any kind which arises, directly or indirectly, and is caused by the use of any part of the information provided.
Throughout our site you will find links to external websites. Although we make every effort to ensure these links are accurate, up to date and relevant, we cannot take responsibility for pages maintained by external providers.
The investment opportunities we offer are only available to qualifying persons or legal entities as defined by your local regulator and on the basis that you are not subject to any jurisdictional restrictions prohibiting access to the information on this platform.
By registering or logging into highcastle.co to view the investment opportunities listed on the platform, you confirm that you are legally entitled to view these investment opportunities and you agree to all applicable terms and conditions on this platform, including without limitation, the Investor Agreement and the Terms and Conditions of the Notes. Any accounts set up in relation to the Notes will be held and managed in the name of HighCastle Investments Ltd, a company registered in England, with its registered office at 20 Wembdon Hill, Wembdon, Bridgwater, Somerset, England, TA6 7PX.