Below are set out the terms and conditions on which we, Prospi Limited (Company Number: 09916766) (Prospi), enable you (the Investor) to invest in a property via our website (www.Prospi.co.uk) (the Website) (the Investment).
You agree to be bound by these terms and conditions in respect of your investment and your dealings with us.
Prospi are an authorised representative of ShareIn Limited (ShareIn) (Scottish Company Number: 408803) with an FCA firm reference number of 734260. ShareIn itself is authorised and regulated by the Financial Conduct Authority (the FCA) (FCA registration number 60332).
- You have decided to invest in a property, information in respect of which is provided on the Website (the Property), by acquiring a beneficial interest in a number of shares (Shares) in a UK limited company (a special purpose vehicle established for the sole purpose of acquiring and owning the Property (the SPV)). 100% of the share capital of each SPV will be legally owned by Prospi Nominee Limited (Company Number: 09921715) (the Nominee). The Nominee will hold the beneficial interest in the Shares on your behalf.
- We will conduct a fundraising (the Fundraising) through the Website pursuant to which we are seeking to raise a pre-agreed minimum amount for each property from investors (the Total Investment Required) by way of an issue of shares in each SPV (to be held by the Nominee in accordance with clauses 2.2 and 5). The Total Investment Required will be sufficient to enable the SPV to acquire the Property and to meet acquisition fees and expenses and any forecast expenses, all of which will be set out on the Website.
- You agree to invest money in exchange for the Shares issued by the SPV, conditional on the Total Investment Required being achieved.
- If the Total Investment Required is achieved and the Fundraising completes you agree for your Shares to be held on your behalf by the Nominee. If the Total Investment Required is not achieved all committed funds are returned to you at no cost to you.
- Prospi reserves the right to decline investment requests via the Website at its sole discretion.
- No further Shares will be issued by an SPV to the Nominee or any other third party following the issue of the Shares unless it is determined, by the Nominee acting on the advice of the Property Manager, that further funds are required by the SPV for Unforecast Costs that cannot be met from any rental income or third party borrowings in accordance with clauses 3.9 and 3.12.
- LEGAL AND BENEFICIAL INTEREST IN THE SHARES AND MANAGEMENT OF THE SPV
- On a successful purchase of any of the Shares in the SPV, the Nominee will become the legal owner of those Shares and will declare that it holds the beneficial ownership of the Shares for you in the terms of a declaration of trust (the Declaration of Trust) a copy of which will be forwarded to you. This arrangement facilitates administration of the Investment.
- By purchasing the Shares in the SPV, you agree that the Shares will be held in the name of the Nominee and that Prospi (acting through the Nominee) will make all appointments of officers and decisions on your behalf in relation to the Shares, and otherwise in accordance with these Terms and Conditions.
- The Nominee will appoint directors of the SPV as it sees fit (Nominee Director). A Nominee Director that is connected with the Nominee will not be entitled to any remuneration or reimbursement of expenses from the SPV in his capacity as such, under any circumstances.
- PROCESS OF INVESTMENT AND REALISATION
- You agree to invest money in exchange for Shares in the SPV in accordance with these Terms and Conditions.
- Prospi will appoint McCafferty Asset Management Limited (the Property Manager) as asset and property manager on behalf of the SPV in respect of the Property
- In making the Investment you agree that you have done so solely based on information
contained on the Website, together with any independent knowledge that you may have and professional advice that you may have received. Nothing Prospi, the Property Manager or the Nominee does, nor anything that is on the Website, is to be construed as advice or a recommendation by any of such parties in relation to the Investment.
- The Nominee will, at least every five years during which the SPV has owned the Property and at such earlier date as the Property Manager may decide as appropriate, procure a valuation of the Company (the Net Asset Valuation). The Net Asset Valuation will be the net asset value of the Company and will be calculated as follows:
- the value of the Property, determined by a Chartered Surveyor who is a member of the Royal Institute of Chartered Surveyors nominated by a Nominee Director or Property Manager in accordance with the Management Services Agreement; plus
- any amount of cash and any other assets then held by the SPV not allocated to expenditure; less
- any liabilities payable by or on behalf of the SPV.
- The Net Asset Valuation shall be uploaded to the Website as soon as possible following its completion.
- The value of each Share shall be calculated by dividing the Net Asset Valuation by the total number of shares then in issue by the SPV.
- Following completion of the Net Asset Valuation, the Nominee will seek an instruction from each of the investors in the SPV via the Website to determine which of those investors would like to realise their investment in Shares at the Net Asset Valuation. The Nominee will determine the timeframe within which responses must be received and, where no response is received from a given investor, the Nominee shall be entitled to assume such investor does wish to sell.
- If it is deemed investors wish to realise their investments in shares in the SPV the Nominee shall arrange for the Property to be sold and the Investors’ shares of the net asset value of the SPV returned to Investors.
- In the event that any unforecast cost (Unforecast Cost) arises in respect of the Property, which cannot be met from the rental income, the Property Manager will act as the agent of the SPV to borrow funds from a third party (whether connected with the Nominee, the Property Manager or otherwise) at reasonable arm's length interest rates and cost to meet the Unforecast Cost.
- In the event that funds are borrowed by any Company to meet the Unforecast Cost, the cost thereof and repayment will be met from the rental income of the SPV until such time as the borrowed funds are repaid.
- Should borrowings made by the SPV be outstanding on a sale of the Property, repayment of the borrowings shall be made out of the proceeds of sale of the Property.
- Only in the event that borrowings are not available to meet the Unforecast Cost will any further shares be issued in the SPV in accordance with clause 1.6.
- Any distribution you receive from the SPV will be placed in your Prospi account (which will comprise an e-wallet held by Mangopay, managd via ShareIn) (your Account). Your Account will be accessible on the Website. You may withdraw credit balances in excess of £20 at any time and there will be a transaction fee, currently 45p, charged to your Account.
- The distribution of dividends from time to time to your Account depends on there being sufficient reserves in the SPV available for distribution.
- THE NOMINEE
- You hereby agree that the Nominee shall hold legal title to your Shares and shall hold the beneficial interest in the Shares for you on the terms of the Declaration of Trust.
- You and the Nominee both agree that the relationship between you shall be that of beneficial owner and nominee only, that neither party has an intention to create a partnership between them and that this agreement should not be construed as such.
- YOUR MONEY AND YOUR ACCOUNT
- The Website allows you to deposit money into your Account, which can then be used by you to purchase Shares via the Website. Until completion of your purchase of Shares, it will remain your money and (subject to completion of know your customer and anti-money laundering processes and clause 7.2) can be withdrawn by you at any time.
- Your Account is held in the form of an e-wallet which is held by Mangopay with Barclays Bank plc and operated by Mangopay. Mangopay are a specialist facilitator for investors via crowdfunding platforms. Mangopay is owned by Leetchi Corp S.A, a public limited liability company incorporated in Luxembourg listed under Number B173459 on the Luxembourg Trade and Company Register, approved as an electronic money institution by the Financial Sector Regulator.
- Mangopay shall hold any money invested by you in accordance with the FCA’s rules, which require that they hold client money in a client bank account segregated from their own funds.
- We shall not be responsible for any acts, omissions or default of any bank but we shall ensure funds are deposited with a recognised UK bank.
- Any money held in a client money account will not attract any interest.
- You acknowledge that Mangopay will cease to treat as client money any unclaimed balances on inactive user Accounts after a period of six years of inactivity provided we have otherwise taken reasonable steps to trace you and return any balance to you. We will nevertheless make good any subsequent valid claim against such balances.
- You acknowledge and accept that you are responsible for transactions associated with your account. If there is cause for us to correct errors or abuse in relation to customer accounts (including unwinding transactions) in line with our obligation to treat customers fairly we shall be entitled to do so.
- MAKING THE INVESTMENT
- In order to commit to making an investment in a property (via an SPV) via the Website, you will first have to deposit funds into your Account at least equal to the amount required to make the investment (Investment Amount). The minimum Investment Amount is £500.
- Once you have indicated, via the Website, that you wish to proceed with the investment in a property and purchase Shares you will not be entitled to withdraw your committed funds unless you have validly exercised the withdrawal rights set out in clause 8, or the Total Investment Required is not achieved and the Fundraising does not complete. In these scenarios, your Account balance will be restored and you can withdraw these funds (subject to completion of know your customer and anti-money laundering processes).
- The aggregate Investment Amounts will be used by the SPV to fund the acquisition of the property and will be removed from your Account immediately prior to completion of such acquisition.
- WITHDRAWAL RIGHTS
- You may exercise your right to withdraw from an Investment in the 14 day period which follows your decision to invest by calling us on +44(0)161 974 0666.
- If you exercise your withdrawal rights in accordance with paragraph 8.1 above, you will be entitled to withdraw the Investment Amount from your Account (subject to completion of know your customer and anti-money laundering processes).
- PROSPI AND THE PROPERTY MANAGER
- Prospi will operate the Website. Prospi will also co-ordinate the collection of sums due from other investors through the Website, or otherwise, in order to achieve the Total Investment Required.
- The Property Manager will arrange for the completion of a survey and valuation undertaken by a Chartered Surveyor that will form the basis for the purchase price of the property.
- The Property Manager will enter into a management agreement with Prospi (and Prospi will in turn enter into a management agreement with the SPV) whereby the Property Manager will perform all necessary tasks in relation to the administration of the SPV and the management of the Property.
- INFORMATION ABOUT YOUR INVESTMENT
- Your Account will provide you with an estimated valuation of your investment in the SPV and information on your Dividends from time to time. In addition you will receive periodic tax statements.
- Your estimated valuation of your investment in the SPV from time to time will consist of the then latest valuation of the Shares (the Regular Valuation).
- The basis for the Regular valuation of the Shares will be as follows:
- initially this will be the purchase price of the Property; plus any amount of cash then held by the SPV not allocated to expenditure; less any liabilities payable by or on behalf of the SPV.
- thereafter, the monthly Property valuation is updated by indexing the purchase price against the house price index published by the Land Registry for a particular region or borough; and
- at least every five years, the Regular Valuation will take the form of the Net Asset Valuation in accordance with clause 3 and which will form the basis for exit strategy.
- YOUR REPRESENTATIONS TO US
- In consideration of our accepting your application to open your Account and to make the Investment, you represent to us (and acknowledge that we rely on these representations) as set out below. We may rescind our agreement with you, close your Account and (subject to completion of know your customer and anti-money laundering processes) return any funds you have deposited with us to you if your representations are false or misleading.
- You represent that:
- you are legally entitled to invest the Investment Amount;
- if you are a natural person, you are at least 18 years old of sound mind and capable of taking responsibility for your own actions such that you can enter into a legally binding agreement with us;
- you agree to provide accurate personal registration information and to inform us of any changes in such details;
- you are the person whose details are provided in connection with your registration or, in the case of non-personal legal entities, you are a duly authorised representative of the relevant legal entity;
- you are acting as a principal and not as an agent on behalf of a third party;
- you will not deposit funds with us that are the proceeds of crime or attempt to launder money via our Website. To assist us in complying with our regulatory obligations to combat crime and money laundering, you agree to provide us with such information as we may request to verify your identity, address and source of funds. You understand that, until completion of know-your-client and anti-money laundering processes, you will not be able to withdraw funds from your Account;
- you are not an undischarged bankrupt, in a voluntary arrangement with your creditors nor subject to other legally imposed circumstances that limit your ability to invest;
- you are not located in a jurisdiction in which it is illegal for you to make use of our Website;
- it is your responsibility to keep your contact details up-to-date on your Account. Failure to do so may result in you failing to receive important account related notifications and information from Prospi, including changes we make to our terms and conditions.
- you are solely responsible for the security and confidentiality of your Account. In particular, you agree to keep your username and password strictly confidential and you are responsible for the protection of and any misuse of your password. Provided that we have been correctly supplied with the account information requested, we are entitled to assume that activity on your account is your activity. You should change your password on a regular basis and never disclose it to any third party. If another person accesses your account other than as a result of our gross negligence, you are solely responsible for all their actions whether or not their access was authorised by you and you hereby indemnify us and hold us harmless against all costs, claims, expenses and damages howsoever arising in connection with the use of or access to your account by any third party;
- you will not attempt to sell or otherwise transfer the benefit of your Account to any third party;
- you will use and regularly update security software so as to better guard against hacking, viruses and computer misuse; and
- all the declarations you made, via our Website, are true and accurate.
- By investing through the Website, you further agree that the Investment will be legally held by the Nominee and that you will do anything required to ensure that the provisions of these terms and conditions and the articles of association of the SPV are observed.
- You will entitled to transfer all (but not part only of) your interest in the SPV at any time.
- Initially Prospi will not be making a secondary market in Investors’ interests in SPVs but are keeping the matter under review.
- If you wish to transfer your interest in an SPV to a buyer (the Buyer) the Buyer and you will together need to enter into and sign an interest transfer form (in a form available to download from the Website). You both then need to date it, scan it and email it to Prospi at email@example.com. In addition the Buyer must open an Account as if he were a new Investor and deposit in his Account the purchase price for your interest. Assuming that all paperwork is properly completed and monies received, Prospi will transfer funds from the Buyer’s Account to your Account and complete the transfer. You will then be entitled to withdraw such monies as are then to the credit of your Account.
- TERMINATION AND VARIATION
- There is no minimum duration of this agreement and termination of this agreement will only occur:
- when the SPV or its assets are sold and the SPV wound up and your monies have been returned to you; or
- at such other time as we decide.
- We may update these investor terms and conditions from time to time to reflect any changes in law or for any other reason. If we update these terms and conditions, we will inform you as soon as practicable, whether by email or an alternative method such as uploading to the Website, and (by your continued use of the Website) you will be deemed to have agreed to the updated terms and conditions and to be bound by the updated investor terms. If there is a conflict between any versions of the investor terms and conditions to which you have agreed, or been deemed to have agreed to, the most recent version shall take precedence, unless it is expressly stated otherwise.
- You will be charged no initial fees whatsoever in respect of your Investment.
- The SPV will be charged by the Property Manager annual property management fees of 12.6% (inclusive of VAT) of the gross rental income received by the SPV invoiced and paid monthly plus a fee in respect of each new letting of the property equivalent to one month’s rental income .
- There will be no ongoing charges from Prospi who will simply be entitled to a 15% share of the SPV’s capital profit on (and in the event of) a sale of the property by the SPV.
- LIMITATION OF LIABILITY
- The Website operates as a platform to facilitate the Investment in Shares and it does not make recommendations. We therefore make no warranties nor assume any liability in respect of the performance of any of the investments available through the Website.
- You acknowledge that we will not be liable to you for any loss, financial or otherwise, that you suffer as a result of using the Website or making the Investment, except as expressly set out in this agreement.
- This clause does not affect our liability for death or personal injury arising from our negligence, nor our liability for fraud, neither of which can excluded or limited under English law, or any liability we have to you as a Client arising under the Regulatory System (as defined in the FCA rules).
- REGULATORY PROVISIONS
- Prospi has categorised you as a retail client under the FCA rules. You may request re categorisation as a professional client under FCA rules, but any such re-categorisation will be conditional upon you meeting various tests required by the FCA. If you are re-categorised as a professional client, it would also mean that there would be limitations to the level of client protections with which you would be provided than if you remained as a retail client. We will provide you with more information relating to being reclassified as a professional client upon request.
- Prospi shall provide best execution in accordance with the FCA rules. A best execution policy has been implemented in order to ensure that Prospi takes all reasonable steps to obtain best execution i.e. the best possible result for you when arranging deals in investments, taking into account the FCA’s execution factors of price, costs, speed, likelihood of execution and settlement, size, nature of the order and any other consideration relevant to the execution of an order. Prospi may revise its best execution policy from time to time. The best execution policy is available on request.
- We are required to have arrangements in place to manage conflicts of interest between our clients and us and between our different clients. We have put in place a Conflicts of Interest Policy which identifies those situations giving rise to actual or potential conflicts of interest and which provides details of how such conflicts are managed. Where the arrangements under our Conflicts of Interest Policy are not sufficient to ensure, with reasonable confidence, that risks of damage to the interests of the client will be prevented, we will disclose sufficient details of the actual or potential conflict to you in order to enable you to take an informed decision as to whether to continue to deal with us notwithstanding the existence of such conflict. We will provide you with a summary of our Conflicts of Interest Policy upon request.
- COMPLAINTS PROCEDURE AND COMPENSATION
The Financial Ombudsman Service
- We want to give you superb customer service but sometimes things might go wrong. We can usually resolve most issues straightaway, so please email us on Team@ShareIn.com or call us on +44 1316 410 018 to tell us how we can help. What you'll need to tell us so that we can help you:
- Your personal details,
- What's gone wrong and
- What you want us to do to put things right.
- We'll be in touch with you as soon as we can and let you know what will happen next. We'll try to resolve your complaint within 10 working days. For more complex issues it's likely that we will need longer to look into what's happened and we may ask you for further information to help us reach a decision. We'll give you regular updates. And once we've dealt with your complaint, we'll go back and see what we can learn from your experience.
- If you're not happy with our response - If you're unhappy with the outcome you can ask the Financial Ombudsman Service (FOS) to carry out an independent review of your complaint. In any event, you have the right to ask the FOS to review your complaint if we've been unable to resolve it within 8 weeks.
- The FOS can help with most complaints if you are:
- A consumer
- A business employing fewer than 10 persons that has an annual turnover that doesn't exceed €2 million
- If you are unsure whether the FOS will consider your complaint, please contact them directly for advice. The service the FOS provides is free and impartial and contacting them at any stage of your complaint will not affect your legal rights. The contact details for the FOS are:
South Quay Plaza
183 Marsh Wall
Their phone numbers are 0300 123 9123 (free from most mobiles) or 0800 023 4567 (free from landlines).
You can send an email to: firstname.lastname@example.org
Or you can log on to their website: www.financial-ombudsman.org.uk
- All investors on Prospi are required to successfully complete our “Appropriateness Test”.
The purpose of this quiz is to allow us to determine that the investor has the experience, expertise and knowledge to understand the risks of investing in early stage companies and to make his or her own investment decisions.
All individual investors on Prospi are treated as retail clients.
All investors are eligible to complain to the Financial Ombudsman Service or to claim compensation under the Financial Services Compensation Scheme (“FSCS”), which will protect sums held in your Account i.e. sums not yet invested in an SPV. The FSCS can pay compensation if Prospi or any third party bank cannot meet an obligation owed to an Eligible Claimant. The current compensation limit as at May 2015 is fifty thousand pounds Sterling (E50,000) in respect of investment business. Further information about the FSCS (including the amounts covered and eligibility to claim) is available at www.fscs.org.uk or call 0800 678 1100.
- No full or partial waiver of any such right or remedy shall restrict us from exercising that right or remedy, or any other right or remedy, in the future.
- If any of these terms and conditions or any provisions of any other document featured as part of your relationship with us are determined by a competent authority to be invalid, unlawful or unenforceable, to any extent, then such term or condition will be severed from the remaining terms and conditions which will continue to be valid, as far as permitted by English law.
- Nothing in this agreement is intended to or will be used to establish any partnership or joint venture between the parties, nor authorise any party to make any commitments for or on behalf of any other party.
- Any notice or other communication given to either party in connection with this contract shall be in writing and delivered by hand or sent by pre-paid first class post (or an equivalent next day delivery service) at its registered address (if a company) or its principal place of business or residential address (if an individual), or sent by e-mail to the e-mail address notified to the other party in accordance with this contract. Our e-mail address for the service of notices is email@example.com. Any notice or other communication will be deemed to have been received if delivered by hand, on signature of delivery receipt or at the time the notice is left at the proper address, or if sent by e-mail, at 9.00 am on the next working day after it is sent or if sent by post (or other delivery service) on the second working day after posting.
- Any dispute or claim arising out of or in connection with the Website, its subject matter or formation will be governed by English law and such disputes or claims will be subject to the non exclusive jurisdiction of the Courts of England & Wales.
- These terms and conditions and any document expressly referred to in them constitute the whole agreement between us and supersedes all previous discussions, correspondence, negotiations or agreement relating to this subject matter.
- INVESTOR WARNINGS
- All persons who register as an 'investor' on this website should read carefully the following warnings before making any investment.
- Your personal decision to invest
- A decision to invest in an SPV is a personal decision by you and that no responsibility for the consequences of that decision is accepted by Prospi or by any of its directors, agents, employees or other members.
- A questionnaire that forms part of the investment registration process on our site will ascertain which category you fall into.
- Losing all of your investment
- Investment carries risks as well as the possibility of rewards. Accordingly each investor should consider very carefully whether such investments are suitable in the light of personal circumstances and commitments and the financial resources available to each Investor. Prospi does not promise any return on investment nor that the value of any investment will be maintained. Engaging in any investment activity may expose you to a significant risk of losing all of your investment.
- Please be warned that the initial anticipated returns are not guarantees that the relevant SPV can achieve what it is hoping to do.
- The value of the Shares and the value of the Property can go up and can go down. Past performance of an investment is not an indicator of the future performance.
- You should take your own tax advice. No warranty or representation is made in relation to your tax position, which will apply to you following the making of any investment.
- If a company you invest in fails, neither the SPV nor Prospi will pay back your investment.
- No established market – lack of liquidity
- As an investor you should be aware that no established market exists for the trading of shares in private companies (which are what the SPV that you are investing in is), and such shares are not easily realisable. It must be appreciated that there could be difficulty in selling such investments at a reasonable price and, in some circumstances, it may be difficult to sell them at any price.
- The need for diversification
- Diversification by spreading your money across multiple investments will reduce risk. Investors should only invest a proportion of their available investment funds via ShareIn due to the high risks involved.
- Prospi does not make personal recommendations and does not promise that a particular investment will be suitable for the individual circumstances of an investor.