TESSERACT INTERACTIVE SEIS FUND 6 · games and downloadable content for the console/handheld...
2
Investment Opportunity The Tesseract Interactive SEIS Fund 6 provides investors with access to companies operating in the interactive entertainment sector. An attractive risk/reward profile is achieved through a balanced blend of investments in high-growth, start-up companies with potential for significant equity returns, and other investments in small enterprises exploiting established franchises, IP and creative teams. The Fund will invest in applications and services for mobile devices, online games and downloadable content for the console/handheld market. Capital will only be invested in companies that have received HMRC advance assurance, which has been granted for all 60+ applications made by the Manager to date. It is intended that all subscriptions to the Fund will be deployed into SEIS Qualifying Shares during the 2015/16 tax year. Benefits of the SEIS The Seed Enterprise Investment Scheme (SEIS) comprises a variety of tax benefits available to UK tax paying individuals, subject to investments complying with the relevant conditions and requirements. Tax reliefs available include: • 50% income tax relief on qualifying investments of up to £100,000 per tax year, in either 2015/16 or 2014/15 • 50% CGT reinvestment relief against capital gains realised in 2014/15 or 2015/16 • No CGT payable on gains realised on the disposal of the investment if held for 3 years • Ability to set off any capital losses realised against other income or gains, potentially reducing capital at risk to 13.5p per 100p invested • 100% relief from inheritance tax for investments held for more than two years, or immediately if investment qualifies as replacement property. Offer Details • Launch Date: 9.00am on 3 August 2015 • Closing Date: 5.00pm on 25 March 2016 1 • Minimum Investment: £10,000 • Minimum Fund Size: £750,000 • Maximum Fund Size: £3,000,000 2 How to Apply After reading the Information Memorandum and Fund Management Agreement, please complete the Application Form and return to Woodside Corporate Services. Key Features of the Fund • The video games market is the fastest growing content sector in the entertainment industry fuelled by the proliferation of smartphones and tablets, increased broadband penetration and the launch of next generation consoles. • Blended investment strategy , targeting a return of 178% pa or a total return on net investment of 622.9% over a 42 month period. Targeted Returns 3 £ Cost of Investment 100,000 Less: Income Tax Relief at 50% (50,000) CGT Reinvestment Relief at effective rate of 14% (14,000) Net Investment 36,000 Investment Proceeds 4 260,259 Total Return on Net Investment 622.9% Average Annual Return (Tax Free) 178.0% Average Gross Equivalent Annual Return 5 323.6% The above target returns are based on a number of assumptions and are illustrative only, with no warranty as to future outcome. Investing with Daedalus • Highly experienced investment team possessing an extensive network of global industry contacts and unrivalled access to Tier 1 video game opportunities. • Strong historic performance in the interactive entertainment arena, delivering investors above 3x return on equity and launching successful titles such as Lumo Deliveries Inc, LA Cops, Poppy Cat and the Bubble Volcano, Dino Dog, and M3CH across a range of digital platforms including Facebook, iTunes, Google Play, XBox and PlayStation Home Network. TESSERACT INTERACTIVE SEIS FUND 6 EXECUTIVE SUMMARY 2015/2016 1 Subject to the discretion of the Manager to close on an alternate date. 2 Subject to discretion of the Manager to increase the maximum size. 3 Based upon a single investment of £100,000, applied against an investor’s 2015/16 income and capital gains tax liabilities, assuming current tax rates and realisation of qualifying investments in the Fund after 42 months. 4 Investment Proceeds are shown net of all related fees, charges, expenses and taxes borne by the Fund and assumes a minimum 25% investor profit participation above their priority return of 120p per 100p subscribed, ignoring any tax reliefs. 5 Average Gross Equivalent Return is the annual return a 45% income tax rate investor would need to achieve from an equivalent investment in order to obtain the same return as that provided by the Company.
Transcript of TESSERACT INTERACTIVE SEIS FUND 6 · games and downloadable content for the console/handheld...
Investment Opportunity
The Tesseract Interactive SEIS Fund 6 provides investors with access to companies operating in the interactive entertainment sector. An attractive risk/reward profile is achieved through a balanced blend of investments in high-growth, start-up companies with potential for significant equity returns, and other investments in small enterprises exploiting established franchises, IP and creative teams.
The Fund will invest in applications and services for mobile devices, online games and downloadable content for the console/handheld market. Capital will only be invested in companies that have received HMRC advance assurance, which has been granted for all 60+ applications made by the Manager to date.
It is intended that all subscriptions to the Fund will be deployed into SEIS Qualifying Shares during the 2015/16 tax year.
Benefits of the SEIS
The Seed Enterprise Investment Scheme (SEIS) comprises a variety of tax benefits available to UK tax paying individuals, subject to investments complying with the relevant conditions and requirements.
Tax reliefs available include:
• 50% income tax relief on qualifying investments of up to £100,000 per tax year, in either 2015/16 or 2014/15
• 50% CGT reinvestment relief against capital gains realised in 2014/15 or 2015/16
• No CGT payable on gains realised on the disposal of the investment if held for 3 years
• Ability to set off any capital losses realised against other income or gains, potentially reducing capital at risk to 13.5p per 100p invested
• 100% relief from inheritance tax for investments held for more than two years, or immediately if investment qualifies as replacement property.
Offer Details
• Launch Date: 9.00am on 3 August 2015
• Closing Date: 5.00pm on 25 March 20161
• Minimum Investment: £10,000
• Minimum Fund Size: £750,000
• Maximum Fund Size: £3,000,0002
How to Apply
After reading the Information Memorandum and Fund Management Agreement, please complete the Application Form and return to Woodside Corporate Services.
Key Features of the Fund
• The video games market is the fastest growing content sector in the entertainment industry fuelled by the proliferation of smartphones and tablets, increased broadband penetration and the launch of next generation consoles.
• Blended investment strategy, targeting a return of 178% pa or a total return on net investment of 622.9% over a 42 month period.
Targeted Returns3 £
Cost of Investment 100,000Less:Income Tax Relief at 50% (50,000)CGT Reinvestment Relief at effective rate of 14% (14,000)
Net Investment 36,000
Investment Proceeds4 260,259
Total Return on Net Investment 622.9%
Average Annual Return (Tax Free) 178.0%
Average Gross Equivalent Annual Return5 323.6%
The above target returns are based on a number of assumptions and are illustrative only, with no warranty as to future outcome.
Investing with Daedalus
• Highly experienced investment team possessing an extensive network of global industry contacts and unrivalled access to Tier 1 video game opportunities.
• Strong historic performance in the interactive entertainment arena, delivering investors above 3x return on equity and launching successful titles such as Lumo Deliveries Inc, LA Cops, Poppy Cat and the Bubble Volcano, Dino Dog, and M3CH across a range of digital platforms including Facebook, iTunes, Google Play, XBox and PlayStation Home Network.
TESSERACT INTERACTIVE SEIS FUND 6
EXECUTIVE SUMMARY 2015/2016
1 Subject to the discretion of the Manager to close on an alternate date.2 Subject to discretion of the Manager to increase the maximum size. 3 Based upon a single investment of £100,000, applied against an investor’s 2015/16 income and capital gains tax liabilities, assuming current tax rates and realisation of qualifying investments in the Fund after 42 months.
4 Investment Proceeds are shown net of all related fees, charges, expenses and taxes borne by the Fund and assumes a minimum 25% investor profit participation above their priority return of 120p per 100p subscribed, ignoring any tax reliefs.
5 Average Gross Equivalent Return is the annual return a 45% income tax rate investor would need to achieve from an equivalent investment in order to obtain the same return as that provided by the Company.
Risks
Investment in the Fund involves a high degree of risk. The level of returns and availability and timing of relief for investors may be impacted by:
• Returns generated by each Investee Company from their respective qualifying trades
• An investor’s individual circumstances and changes to tax legislation
• The availability and timing of suitable investment made by the Manager together with the SEIS qualifying status thereof
• The fact that counterparties to the projects engaged in by each Investee Company may fail to honour some or all of their obligations under the relevant contracts, which may adversely affect the anticipated returns
Past performance is not a guide to future performance and may not be repeated. The value of shares can go down as well as up and you could lose part or all of your capital invested. You should consider an investment in the Fund as a medium term to long term investment. Investments made by the Fund are likely to be illiquid.
Investors are strongly advised to seek independent legal, financial and tax advice before making a decision to invest. Full details of the risk factors and associated mitigation strategies can be found in the “Risks” section of the Information Memorandum.
Costs
Charges include:
• Each investee company will pay the Manager a one-off initial fee equivalent to 3.00% capital subscribed plus an annual monitoring charge of £2,250
• Annual custodian charges of up to 0.50%
• Performance fee to incentivise the Manager equivalent to 37.5% of any distributions (or amounts realised/payable) to the shareholders of each Investee Company, subject to investors in the Fund first receiving 120p for every 100p invested (ignoring tax reliefs)
• Reasonable third party expenses incurred by, and costs of, the Manager and its affiliates in managing, administering and providing services to the Fund and its investments may be charged to the Fund or the Investee Companies, as appropriate
Facilitation Payments
• The Manager can facilitate the payment of adviser charges from the investor to their adviser, if requested.
Important Regulatory Information
This Executive Summary is a summary of the Information Memorandum for the Tesseract Interactive SEIS Fund 6 (the Fund). This information does not constitute or form part of any offer for sale or solicitation of any offer to buy or subscribe for the Fund. Any decision in connection with an investment in the Fund should be made only on the basis of information contained in the Information Memorandum. If you are in any doubt about the content of the Information Memorandum, and/or any action you should take, you are strongly recommended to seek advice immediately from an independent financial adviser authorised under the Financial Services and Markets Act 2000 who specialises in advising on opportunities of this type. Nothing in this document or the Information Memorandum constitutes investment, tax, legal or other advice by Daedalus Partners LLP. An investment in the Fund will not be suitable for all recipients of this document or the Information Memorandum.
All statements of opinion or belief contained in this Executive Summary or Information Memorandum and all views expressed, statements made and all projections and forecasts regarding future events or the anticipated future performance of the Fund represent Daedalus Partners LLP’s own assessment and interpretation of information available to them as at the date of the Information Memorandum. No representation is made or assurance given, that such views, statements, projections, forecasts or anticipated future performance are correct, attainable or complete or that the objectives of the Fund will be achieved. The views, statements, projections, forecasts and anticipated future performance are based upon various assumptions and estimates which involve significant elements of subjective judgement and analysis and which are subject to uncertainties and contingencies; actual results could differ materially from those set forth in such projections, views, statements, forecasts and anticipated future performance. Prospective investors must determine for themselves what reliance (if any) they should place on such statements, views, or forecasts, and no responsibility is accepted by Daedalus Partners LLP in respect thereof. Issued, approved and managed by Daedalus Partners LLP, 71-75 Shelton Street, London WC2H 9JQ which is authorised and regulated by the Financial Conduct Authority.
CONTACTS
Lenny Norstrand 020 3006 7531 [email protected]
Matthew Brown 020 3006 7532 [email protected]
Gavin Harrison 0207 866 5487 [email protected]
Stephen Norton 0207 866 5485 [email protected]
