Annex I. About Vireo

Transcription

1 Annex I About Vireo v1.0 - January 2018

2 The Origins of Vireo: how the idea started and evolved 3 Management Team 4 Vireo Board Members and Advisors 5 Board Members 5 Vireo Advisors 6 Detailed Problem Statement 8 Green project developers struggle to access finance 8 Green investors struggle to find interesting projects 8 General Terms & Conditions, Risk Management, General Disclaimer 10 Terms and Conditions 10 Regulatory Framework 10 Treasury 10 Know Your Customer 10 Anti-Money Laundering 10 Data Protection 10 Risk Warning 11 Risk Management/Safeguarding the Investment 11 FX Risk 11 Liquidity Risk 11 General Disclaimer 12

3 The Origins of Vireo: how the idea started and evolved Vireo means green vigor in latin, and it stands by its meaning. Vireo LLP (established May 2017 in Singapore) is the result of a long process that brought the founders (Fred and Tony) and co-founders (Manu, Reno and Glen) together under the realization that green project finance required to undergo a dramatic transformation to meet the challenges of a sustainable future for all. This is the brief story of how the Vireo core team progressively came together behind the whole idea of Vireo (Vireo Investment Management and Vireo Asset Management) and Vireo Products (the Seeds, the Crops and Vireo Certificates). Fred and Tony first identified the need for an innovative, dedicated Asset Management solution for green project finance in emerging countries back in 2015, after more than 2.5 years trying to help local green projects developers to obtain financing solutions. At that stage it became obvious that there was an urgent need to provide better financing options for privately owned mid-sized green projects, to meet the untapped demand of green financing and the unsatisfied investment appetite of impact investors. In October 2016, the first version of Vireo solution was designed, based on an hybrid Debt Equity Fund solution. At this period of time Reno and Manu joined the team s effort, after having experienced similar problems in relation to the slow improvement of green development caused by the big disconnect between green development and climate mitigation policies and the realities on the ground. However, on top of the outdated standards and principles that block new initiatives, the solution was limited due to the existing high cost of the traditional financial solutions. March 2017, the team works on a blockchain based concept to bridge the gaps noticed with the previous structure. Furthermore, with the benefits of the blockchain and the Distributed Ledger Technology, several new concepts take place such as the different instruments to target the full spectrum of impact investors, the green commodity backed digital assets or the decentralized Asset Management platform. April 2017, the team composed of 4 members enters into a partnership agreement to formalize the collaboration and assets brought by each member. The business plan and Vireo concept are formalized. June 2017, Vireo Limited Liability Partnership is registered in Singapore. The power of blockchain and best financing standards are merged to give birth to Vireo Products: the Seeds, the Crops and Vireo Certificates. Since this period, the valuation tool and the concept will be further detailed and developed to create unique instruments at the crossroad between FinTech and traditional finance. September 2017, Glen joins the team, bringing his knowledge of the Singaporean financial and regulatory context as well as his know-how on asset valuation and FinTech. Since early 2017, the Vireo founding team has been committed to create a minimum viable product to test and bring to market this idea.

4 Management Team Vireo management team is composed by different but complementary backgrounds that accumulate over 60 years of experience in structured finance, project finance, project management, international development, green energy and climate policy advisory. Vireo members cover deep knowledge of the green energy, clean water and low carbon market, regulatory and policy context across Asia. Frédéric Delaroche (Fred) - Chief Executive Officer, Founder of Vireo Fred has almost 15 years experience within the financial industry. He has vast knowledge of banking standards and regulations, deep understanding of Equity and Fixed Income market activities and high level management skills in relation to sales, operations and risk management. Fred holds a Master in Finance and Investment, a MSc in Civil Engineering and a BSc in Theoretical Physics. He is French native, fluent in English, and has notions of Thai and Japanese. My personal goal is to implement innovative solutions and build collaborative environments that foster equitable, inclusive, sustainable projects for the benefit of local populations around the world. Anthony Bordier (Tony) Models and FX Hedging, Founder of Vireo Tony has 15+ years of professional experience working on quantitative modelling, algorithmic trading, FX and Equity activities for the most reputed investment banking players (Merrill Lynch, JPMorgan, ANZ, Standard Chartered, Société Générale). He holds a doctoral degree in Probability & Finance, MScs and BScs in Business, Applied Math Engineering, Corporate Finance Engineering,and Mathematics. He is a French native and fluent in English and Spanish. My role in Vireo is to apply advanced mathematical modeling skills to democratize investment opportunities to the emerging crowd of global impact investors. Manuel Cocco (Manu) Chief Operating Officer, co-founder of Vireo Manu is a senior expert with 15+ years of professional experience working on climate change & renewable energy policy development, public climate finance, sustainable development advisory and project and portfolio management. He has deep knowledge of the SD and CC policy environment, community and network; strategic and project portfolio management for green infrastructure projects; and business development, advisory, communication and client management. Manu holds a double MSc in Industrial Engineering and an international MBA with focus on International Development. He is native in Spanish and Italian, and fluent in English, French, Thai and Portuguese. My dream is to contribute to create a real, collaborative, win win green finance ecosystem that can help people empower themselves, so we can all collectively build a better, more sustainable future. Glenden Khew (Glen) Business Development and Valuation, co-founder of Vireo Glen has almost 15 years of quantitative research, modelling, exotic trading, complex structuring, systematic algorithmic trading and risk management experience in global FX and Commodities markets for the investment banking and energy trading industries in Europe and Asia (Standard Chartered Singapore and London, BNP Paribas London, JP Morgan Chase London, Noble Group Europe, HSBC London). He holds an MPhil in Mathematical Finance, an MSc. in Financial

5 Engineering, a BSc. in Mathematics and is currently pursuing his PhD. thesis in Applied Mathematics. My ideal is to apply my skills and knowledge to this Vireo venture so Singapore and Asia can be the hub and catalyzer for a brighter, greener, more vigorous future for all humanity. Vireo Board Members and Advisors In order to achieve its ambitious development objectives, Vireo is working with a large number of partners, spanning expertise from the blockchain digitalization, payments and exchange of value, to the valuation and verification/vetting of projects and project design and financial structuring, and the financing of equity investments in the region, with a particular focus on RE in SEA. Board Members To ensure the best strategic development, Vireo will rely on the expertise of its valued Board Members who will be able to guide and support the Management team. Board Members have a strong experience across all the necessary fields that Vireo will have to go through. Alan Laubsch (Alan) Partner Lykke and Blockchain Ecosystem Specialist Alan has 20 years of risk management experience and has advised major global banks, asset managers, and sovereign institutions on market and credit risk. A co-founder of the RiskMetrics Group, his expertise encompasses next-generation risk management practices including early warning methodologies and stress testing. Alan was a former VP at JPMorgan s Risk Advisory Group in New York, he joined that firm in 1993 after receiving a B.S. in Industrial Engineering from Stanford University. Active in the global risk community, Alan is a frequent speaker at industry and banking forums and also contributes to high-profile financial publications such as the Asia Wall Street Journal. Alan believes in healthy living, individually and collectively. Risk management is a common good, and his mission is to help spark a global risk culture with ecosystems perspectives. Nick Ayton (Nick) CEO Chainstarter and ICO Specialist Nick is a thought leader and a global expert in blockchain, having worked in technology for 35 years with a background in Computer Science, Product Development, Sales and Restructuring. He was involved in 8 tech starts and used to be a corporate citizen holding senior roles in some of the largest IT Services, BPO and Tech companies over a career spanning more than 30 years. A prolific man, Nick Ayton is not only a Blockchain Architect, Ethereum Believer and ICO Advisor, but also a filmmaker, who is creating a new film project project, that is revolutionising the way films are produced and financed. Besides aiming to design Blockchain propositions in film and entertainment, he is also interested in renewable energy, sharing economy, trading, insurance, capital markets. Clive Mason (Clive) CEO Clive Mason Consulting and Green Finance Expert Clive Mason has over 40 years working experience in more than 90 countries. He is an acknowledged expert in the fields of environmental and social risk assessment and management for the financial sector and has worked on numerous renewable energy, energy efficiency and cleaner production projects. He has performed due diligence and project reviews as well as

6 providing advice on E&S risk management for investment committees. Formerly the Head of the International Finance Corporation s (IFC) Sustainable Financial Markets Facility, Clive worked prior to that extensively in the Middle East, SE Asia and China. There, he ran a number of organizations in the environment industry, involving cleaner production and environmental technology transfer. He has authored/co-authored several publications, including Environmental Management in Asia (1997) and more recently Financing Mechanisms for Clean Energy, for the Small Island Developing States, that was published by the World Bank in Ken Tachibana (Ken) Digital Marketing Expert Managing principal of Intelligence Capital based in Faro/London, Ken is an ICO producer assisting a number of leading ICO s in various stages of development (including Pundi X, InsurePal, Flux, thrivelabs and Discoperi Inc) from seed financing, pre-sales funding, worldwide ICO marketing and post-ico implementation including completing engineering and development, business development and retained executive search. To this, he brings financial, business and technology backgrounds Bank of America Corporate Finance and Treasury, deep Silicon Valley/Southern California high tech experiences including co-founding Blockchain and fiat based cryptocurrency startup Digifund based in LA and senior manager of Netscape Communications/AOL Time Warner as well as a board member of a technology holding co of London, DTM Global Holdings Ltd which will go public in the near future. His approach has been sharpened in its rigor by his business teaching experiences as former Lecturer, UC Berkeley Haas School of Business MBA/Executive Programs and Stanford, backed up by his MBA Finance, UC Berkeley Haas School of Business, MS Computer Science-AI/Applied Econ, Stanford. Vireo Advisors Additionally, there is also a number of individuals, that have been collaborating independently and that have been very closely related to the development of Vireo. They are Vireo Associates: Dmitry Koval (Dmitry) Chainstarter CTO and Blockwise CEO Dmitry has a strong IT and blockchain background and is a serial entrepreneur who has launched several companies in the IT space. Since 2016, Dmitry is highly involved in the blockchain world; he is the founder and CEO of Blockwise Limited, a UK registered company providing consulting and development services related to the blockchain, and a co-founder of Chainstarter Limited, Richard Cayne (Richard) CEO at Asia Wealth Group Holdings Richard has over 15 years' of experience in Japan, beginning with a short assignment at Sony before changing his career path to wealth management, where he gained much of his market knowledge and experience in servicing the wealth management needs of the Japanese market. In March 2000 Richard founded the Meyer Group and is currently Managing Director of Meyer Asset Management Limited, a wealth management advisory firm. He is also CEO of Asia Wealth Group which is a listed company in London. Richard is Canadian and speaks fluent English and French and has a working knowledge of Japanese

7 David Hodgkinson (David) - CEO Emerald Asia and Cleantech Investment Expert David is a seasoned fund manager for private and public investment in clean tech investment portfolios in Asia. He has over 25 years of experience as a staff member of multilateral development institutions, including the World Bank (12 years) and the Asian Development Bank (12 years+), originating and managing private sector investment portfolios ranging from agribusiness projects to development-oriented private equity funds. Subsequently, he headed ADB s commercial co-financing team, with a global remit to arrange financial partnerships with leading international banks and institutional investors and to structure and execute credit and political risk guarantees. This included also extended experience with technical assistance to project sponsors (whether public-, private- or PPPs), in project preparation and fund raising, from traditional sources as well as specialized infrastructure and climate finance providers. In addition to his role at Emerald, David is Special Advisor to the Asean China Investment Fund, a private equity fund operating in South East Asia and China. Previously he served on the boards of H&Q Ventures and Planter s Bank in the Philippines, and was a member of the Advisory Board of the NIF Daiwa Asia-Pacific Fund (Singapore). Chi Meng Leong (Chi Meng) Investment Specialist Chi Meng has 27 years of professional experience within the real estate industry and business, both in public markets and private equity and real estate funds. He has an extensive experience in real estate investment management, development and asset management, across Asia. He has specific skills in the areas of developing investment strategies; sourcing and origination of investments; investment underwriting; asset management; asset financing; investor relations and reporting.

8 Detailed Problem Statement In recent years, green investments have raised in popularity both in emerging markets and in developed countries. More and more investors are valuing green projects as a long term and sustainable strategy and have significantly increased the financial resources dedicated to such projects. 1 For example, The Paris Agreement s 2ºC objective represents a global $12.1 trillion investment 2 opportunity for new renewable electric power generation over the next 25 years, with a finance gap currently estimated at $5.2 trillion, this is, an estimated $208 billion per year. Emerging markets have a huge potential for green investments given the expected increase in 3 energy demand and the need to meet internationally agreed green development targets. However, international finance lacks for adequate solutions to foster green investments in raising economies. Both green project developers and green investors suffer from this situation and, as a consequence, many green projects remain untapped. The main reason identified is that traditional financing channels and standards are not well adapted to the needs of neither green project developers (in particular, those in emerging countries) nor green investors. Green project developers struggle to access finance Green project developers in emerging countries suffer for the lack of adequate solutions: Rigid and outdated international financial standards and principles that don t adapt to today s needs and thus, that cannot offer viable alternatives to spearhead green investments Lack of Technical Assistance and international support to develop their projects in compliance with best international standards. The vicious circle of expensive financing solutions leads local project developers to invest in cheaper technologies leading to lower profitability for projects; thus leading to more expensive financing solutions Intermediation layers adding significant extra costs and thus leading to higher financing costs, demanding repayment structures and unreasonable Green investors struggle to find interesting projects Green investors, on the other side, have to endure a similar lack of a supportive environment and limited range of investment opportunities: High entry costs leading to more lucrative and risk averse investment strategies Low liquidity of infrastructure assets on the traditional financial markets leading current financial institutions to be highly selective when choosing projects and putting aside a significant number of viable projects. 1 The Paris Agreement s central aim is to strengthen the global response to the threat of climate change by keeping a global temperature rise this century well below 2 degrees Celsius above pre-industrial levels and to pursue efforts to limit the temperature increase even further to 1.5 degrees Celsius. See more at Southeast Asia leads the world in CO 2 emission growth per capita (263% increase from 1990 to 2013), expects a strong average GDP growth rate of over 6% throughout the next decades, and requires substantial energy capacity additions to fulfill the ever-growing energy demand of its increasing population.

9 Intermediation layers not fully transparent and following lucrative business plans with the excuse of compliance with international standards. In most cases, they charge additional margins to maintain their committed IRR while compensating their lack capacity to investment. As a consequence, many projects remain untapped and only a limited number of opportunities are introduced to investors Because of the lack of adequate solutions, there is an untapped demand to finance projects that can provide interesting returns while supporting the real economy and bring forth the required ongoing global paradigm shift towards a low carbon, collaborative, circular economy. At the same time, 90% of its population is endangered by climate change impacts, which is fueled by all the above. A clean energy transition is needed, opening large investment opportunities and the possibility for transformational change.

10 General Terms & Conditions, Risk Management, General Disclaimer Terms and Conditions Any contribution will be subject to the acceptance of the full Terms and Conditions (hereinafter, TnCs which will be available on The law of Singapore applies to the TnCs and any agreement entered with Vireo under them. Any dispute arising out of or in connection with the Vireo ICOs, subsequent Vireo Tokensale, and Seeds and Crops ICOs and the development and execution of the Vireo AM platform and solution shall be exclusively and finally settled by the ordinary courts of Singapore. Regulatory Framework Singapore is one of the world s leading financial sector hubs. The Monetary Authority of Singapore (MAS), the Government and all current regulations apply. The Vireo pre-ico and token issue complies with the current regulatory framework of Singapore, and has considered international frameworks where known such as the Securities and Exchange Commission (SEC) recent findings as well as the incoming European General Data Protection Regulation (GDPR). Treasury The Treasury policy of Vireo focuses on risk reduction. Digital currencies received as part of Vireo activities will be managed and sold progressively in a way to reduce the risk inherent in holding digital tokens. Know Your Customer Vireo will conduct all KYC processes to properly identify its customers and make sure that they have appropriate background and knowledge to invest in the Vireo Tokens, the Seeds, the Crops or Vireo Certificates. Furthermore, during the KYC process, Vireo will make sure that potential investors subject to local regulation comply with such regulations. Anti-Money Laundering Vireo will operate AML compliant processes in respect of fiat money to token currency and vice versa. Contribution payments and Seed issuances will be made to the same party, i.e. no third-party registrations will be accepted. Any sale of Seeds, Crops and Vireo Certificates by Vireo will be through recognized exchanges. Data Protection The processing of personal data (and, potentially, sensitive personal data) by Vireo is subject to the Data Protection Act 1998 (DPA). Vireo has been registered with the Information Commissioner s Office since October In line with many other organizations, Vireo is preparing for compliance with the new General Data Protection Regulation (GDPR). It should be noted however that the effect of the GDPR on blockchain deployments is not yet fully understood. Encrypted and/or hashed data, for example, may still constitute personal data.

11 Risk Warning Buying, selling and holding digital assets or cryptocurrency is never without risk. You should only make a contribution in return for Vireo Tokens, Seeds, Crops or Vireo Certificates if you are happy with the risks of doing so. As we are undertaking a relatively new type of fundraising, there may be unforeseen risks of which we are currently unaware. All content provided through this white paper is only for your personal information and use, and is not intended to address your particular requirements or to be relied upon in making (or refraining from making) any specific decision. Such content shall not constitute any form of advice or recommendation by us. Risk Management/Safeguarding the Investment In addition to the inherent risks mentioned above related to the issuance of a digital token / asset via an Initial Coin Offering (ICO), of the digital asset investment, of the green project financing, development and construction; and of the valuation models, Vireo will have to consider 2 additional risks: FX Risk 1. FX risk on the accumulated cash 2. Liquidity risk If all projects produce energy with the common kwh measure, the cash related to this energy is not unique. Vireo may receive as many currencies as the number of countries where Vireo will finance projects. Therefore, Vireo will have to make sure that the value of the accumulated cash is not impacted by deflation of underlying currencies. To cover this risk, Vireo will follow the principles below: i. Definition of a basket of reference currencies: Vireo will define a basket of currencies, being either a FIAT currency or a digital currency, that will gather all possible reference currencies which will be used to evaluate Vireo cash position ii. Selection of a reference currency: using the basket of reference currencies, Vireo will chose a currency (the Reference Currency ) that will comply with the following criteria: a. Reference currency should be the most liquid b. Reference currency should be the most stable c. Reference currency should not suffer from high inflation iii. Vireo will convert cash into part or all of the reference currencies, as necessary, and will then follow the FX moves of these reference currencies vis a vis the Reference currency Using this methodology, Vireo will adjust the value of the accumulated cash to follow the strongest currency in the basket of reference currencies. Liquidity Risk To ensure liquidity, Vireo can include FIAT cash reserves in the Seeds and Crops to support secondary market. This means that, in case exchanged volumes on the market become small, Vireo will have the capacity to handle some Buy and Sell operations to ensure minimum volumes and make both the Seeds and the Crops interesting for investors.

12 Lack of liquidity implies high variations of prices: if there are few buyers and / or few sellers, it is difficult for either the buyers or the sellers to find counterparties on the market to trade. To assure minimum liquidity: Vireo can increase project costs up to 5% to assure up to 10% monthly liquidity, considering a 2 week period of time between a buy and a sell The liquidity management will apply for Seeds and Crops. In due time, Vireo will create a team of traders that will manage trading activities to provide liquidity on the secondary market. The pricing that Vireo will offer will depend on: o Liquidity reserve available: if cash for liquidity reserve decreases, Vireo will have to lower its buying price (the bid price) o Accumulated cash: if Vireo has accumulated enough cash, the liquidity reserve will be increased to assure higher liquidity. However, in the case Vireo has to assure high level of liquidity and that the Accumulated cash level decreases, Vireo will have to lower its offering price. The liquidity management, which should help maintaining volumes on the secondary market, will lead to a possible liquidity risk: A decrease in liquidity reserve AND accumulated cash if Vireo has to regularly buy back Seeds or Crops, leading to a decrease in market price of the related digital currencies: o For the Seeds: a lower value than the book value of the Seeds; or o For the Crops: a lower value than the Asset Value of the Crops Vireo team will put in place a system to guarantee a maximum liquidity depending on its liquidity reserve and accumulated cash to protect all investors from a massive selling trend, so that every investors will be able to redeem its digital currencies at an appropriate value. General Disclaimer This document is a technical whitepaper setting out the current and future developments of Vireo LLP and its proposed solution (including Seeds, Crops, Vireo Derivatives, Vireo services, business model, valuation software and exclusive project pipeline) (hereinafter, Vireo ). This paper is for information purposes only and is not a statement of future intent. Unless expressly specified otherwise, the products and innovations set out in this paper are currently under development and are not currently in deployment. Vireo makes no warranties or representations as to the successful development or implementation of such technologies and innovations, or achievement of any other activities noted in the paper, and disclaims any warranties implied by law or otherwise, to the extent permitted by law. No person is entitled to rely on the contents of this paper or any inferences drawn from it, including in relation to any interactions with Vireo or the technologies and solutions mentioned in this paper. Vireo disclaims all liability for any loss or damage of whatsoever kind (whether foreseeable or not) which may arise from any person acting on any information and opinions relating to Vireo, the Seeds, the Crops, the Vireo Derivatives or any other technical and business element contained in this paper, or in any case any information which is made available in connection with any further enquiries, notwithstanding any negligence, default or lack of care. The information contained in this publication is derived from data obtained from sources believed by Vireo to be reliable and is given in good faith, but no warranties or guarantees, representations are made by Vireo with regard to the accuracy, completeness or suitability of the information presented. It should not be relied upon, and shall not confer rights or remedies upon, you or any of your employees, creditors, holders of securities or other equity holders or any other person. Any opinions expressed

13 reflect the current judgment of the authors of this paper, may change without notice and they do not necessarily correspond or represent the opinion of Vireo. Vireo does not have an obligation to amend, modify or update this paper or to otherwise notify a reader or recipient thereof in the event that any matter stated herein, or any opinion, projection, forecast or estimate set forth herein, changes or subsequently becomes inaccurate. Vireo, its founders, directors, employees, contractors and representatives do not have any responsibility or liability to any person or recipient (whether by reason of negligence, negligent misstatement or otherwise) arising from any statement, opinion or information, expressed or implied, arising out of, contained in or derived from or omission from this paper. Neither Vireo nor its advisors has independently verified any of the information, including the forecasts, prospects and projections contained in this paper. Each recipient is to rely solely on its own knowledge, investigation, judgment and assessment of the matters which are the subject of this report and any information which is made available in connection with any further enquiries and to satisfy itself as to the accuracy and completeness of such matters. Whilst every effort is made to ensure that statements of facts made in this paper are accurate, all estimates, projections, forecasts, prospects, expressions of opinion and other subjective judgments contained in this paper are based on assumptions considered to be reasonable as of the date of the document in which they are contained and must not be construed as a representation that the matters referred to therein will occur. Any plans, projections or forecasts mentioned in this paper may not be achieved due to multiple risk factors including without limitation defects in technology developments, legal or regulatory exposure, market volatility, sector volatility, corporate actions, or the unavailability of complete and accurate information. Vireo may provide hyperlinks to websites of entities mentioned in this paper, however the inclusion of a link does not imply that Vireo endorses, recommends or approves any material on the linked page or accessible from it. Such linked websites are accessed entirely at your own risk. Vireo does not accept responsibility whatsoever for any such material, nor for consequences of its use. This paper is not directed to, or intended for distribution to or use by, any person or entity who is a citizen or resident of or located in any state, country or other jurisdiction where such distribution, publication, availability or use would be contrary to law or regulation. This paper may not be redistributed, reproduced or passed on to any other person or published, in part or in whole, for any purpose, without the prior, written consent of Vireo. The manner of distributing this paper may be restricted by law or regulation in certain countries. Persons into whose possession this paper may come are required to inform themselves about and to observe such restrictions. By accessing this paper, a recipient hereof agrees to be bound by the foregoing limitations. On Risks : Further risks are outlined in the Terms and Conditions in the product term sheet. On Intellectual Property (IP) : Vireo s idea is to create a mutually beneficial and collaborative environment amongst a wide variety of partners. The Vireo solution, its software and related protocols will be modeled on top of an open platform, and the code will be made available in due time. Our IP policy is determined to eventually evolve to a Creative Commons license, and progressively towards total open source as our solution establishes itself in the mid-term. Currently, Vireo is too small and weak to be able to share all its valuation coding. As Tesla, Vireo is determined to help catalyze a big paradigm shift for the benefit of all, so Vireo will not hesitate to share its best and most valuable intellectual property information for the benefit of the global community. But first Vireo will need to make sure that it can survive such a big step.