EIS PORTFOLIO SERVICE. Build a portfolio of tax efficient private company investments

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1 EIS PORTFOLIO SERVICE Build a portfolio of tax efficient private company investments Intelligent Private Company Investing

2 Visit rockpool.uk.com Call Please read this document and the application form carefully, think about the risks involved in investing in unquoted shares of smaller companies under the Enterprise Investment Scheme and talk to your financial adviser about how Rockpool s EIS Portfolio Service could work for you. If you re ready to invest, please complete the application form. If you change your mind at any time, we will return any un-invested cash to you.

3 BUILD A PORTFOLIO OF UK PRIVATE COMPANIES Enhance returns and reduce risk with the Enterprise Investment Scheme Do you have significant income tax to pay? Reclaim up to 30% of the amount you invest in EIS against your income tax bill for the year in which you subscribe for shares or for the previous year. Have you made a capital gain in the last 3 years? Defer or reclaim a capital gain from the sale of shares, property or other assets by subscribing for EIS qualifying shares. OUR MANAGED SERVICE OFFERS Diversification and rapid deployment No fees to pay Choice of risk profiles Professional due diligence on each company

4 MINIMUM INVESTMENT 2,500 PER COMPANY 10,000 PER APPLICATION

5 HOW IT WORKS Strategy We offer investment in companies fitting Growth and Asset-rich strategies. Choose one of these or both depending on your risk appetite: Asset-rich - targets companies where ownership of assets or contractual arrangements may reduce risk. Growth - targets profitable companies with higher growth potential. Decide how diverse your portfolio should be We expect to source 6-8 opportunities, per strategy, each year. Timing and deployment We invest your funds as quickly as possible, subject to achieving at least the diversity you have chosen. Minimum investment Minimum investment is 10,000 per application and 2,500 per company. We source a flow of EIS qualifying UK private companies, analysing and investigating each potential investment. We negotiate the best terms for investors. We issue EIS 3 certificates for your investments as soon as possible after completion of your investment, subject to the company trading for four months and HMRC s turnaround timing. We report regularly on the progress of each company. We provide online access to your account, with full history of investments and access to your EIS 3 certificates. You can enable a trusted advisor to view this information. Rockpool s EIS Portfolio Service is a way of investing money that you do not require to meet your foreseeable needs and which you can afford to put at risk with a view to earning higher returns. Your capital will be at risk and there is no guarantee of any investment return. The value of shares may go down and you could lose all of your investment. EIS shares are not listed and this means that you may not be able to sell them when you want to do so. This sort of investment does not provide a reliable source of income.

6 INVESTMENT STRATEGY CHOICES Asset-rich This strategy is designed for investors whose focus is on lower risk and an exit as soon as possible after the 3-year minimum holding period. The focus is on the total return at exit. Our aim is that investors should receive proceeds of between 1.10 and 1.30 per 70p of net cost, equivalent to between 13% and 18% compound annual growth respectively. Target returns of 1.10 to 1.30 for every 70p of net invested cost Rivington Construction Rivington Construction arranged the construction of a care home under a fixed price contract. Its customer is part of a well-established care home group, which owns the freehold of the site. The company has a charge over the freehold to secure payment of the contract price. The aim is to achieve an exit for investors as soon as possible after the 3-year EIS minimum holding period. The projected return to investors is 1.29 for every 70p of net invested cost and represents a multiple of 1.8 times net cost and an IRR of 18% per annum over 3.5 years. Your capital is at risk and you may not get back what you invested.

7 Growth Do you see value in smaller companies? Perhaps you have enough safe investments, and you re prepared to take more risk in order to gain higher growth potential. Growth opportunities typically arise when ambitious businesses come to a moment of change. They need capital to establish or cement a competitive advantage, which could multiply investors capital by 3 times or more over a 5 year period. With full EIS benefits, this would translate into tax-free compound annual growth of 30% or more. Multiply capital by 3 times or more over a 5 year period Airedale Catering Airedale Catering Equipment Group installs commercial kitchens in restaurants, schools, and similar properties. Rockpool investors helped management to buy this profitable 18m business from its private owners in Rockpool investors provided EIS qualifying funds to support rapid growth, as part of a 3m funding package. The target return for EIS investors was set at 3.64 for every 70p of net invested cost after 30% tax relief. With revenues up 100% over 3 years, the investment is now expected to out-perform this target. Your capital is at risk and you may not get back what you invested.

8 WHY CHOOSE ROCKPOOL? Our services are designed to give investors a unique level of flexibility and control. We do not ask you to commit to a fund and we don t charge you any management fees. We can help you invest in businesses in a wide range of sectors. That means you can diversify your EIS portfolio without putting small amounts of capital with a variety of fund managers. You can change your preferences or stop investing at any time. Thorough Transparent Good value Thorough Our team of private company experts search for wellpositioned businesses, carry out in-depth due diligence on each potential investee and negotiate attractive terms on behalf of our investors. Transparent We provide regular updates on each company in your portfolio, giving you a more detailed understanding of your investment. You can access details of your transactions and your portfolio valuation along with company updates online. Good value There are no fees for investors to pay. Each investee company pays Rockpool an arrangement fee at completion of the relevant investment and an ongoing monitoring fee thereafter. We participate in the success of each investment with an option to subscribe for shares in the investee companies.

9 TAX RELIEFS The Enterprise Investment Scheme offers multiple tax benefits to improve your potential returns. Income tax relief You could reduce the cost of your EIS investment by up to 30% by reclaiming income tax. Imagine that you invest 100,000 in EIS companies, your potential saving is 30% of cost: 30,000. Capital gains deferral You could reduce the cash tied up in this EIS investment by up to a further 28,000 by rolling over capital gains made on shares, property and other assets in the last 3 years, because you don t have to pay CGT on those gains until you sell the EIS shares. Inheritance tax exemption No inheritance tax is payable on qualifying investments held at death and for two years before. Imagine that the value of your portfolio increases to 200,000 and that your other assets exceed the 325,000 allowance for inheritance tax. Your potential saving is 40% of the full value of your shares: 80,000. Loss relief If your EIS shares are sold for less than the net cost, you should be able to set your loss against taxable income and gains in the year of loss. If you rolled over a capital gain when investing, the deferred capital gain is reduced by any loss. These reliefs potentially reduce your exposure to loss to less than 40% of your investment. All of the above could change, removing tax benefits that you expected to enjoy. You might even have to repay some or all of the income tax relief you receive, together with interest. If you defer a capital gain by investing in EIS shares, and tax rates subsequently increase, your liability to capital gains tax could be higher than it would have been at the time you invested. The date on which you receive any tax relief depends on when each investment is made and realised, and not on when you apply to invest.

10 IMPORTANT INFORMATION Portfolio diversity options You may want to spread your investment across many companies, as part of your approach to controlling risk. If diversity is less important for you, you might choose to concentrate your Rockpool EIS portfolio in just one or two companies. Our Service is designed to give you this choice. Claiming tax relief To claim EIS tax benefits, you need an EIS 3 certificate for each investee company. We manage the process of obtaining this certificate and we will send it to you as soon as possible after the relevant investment is made. We need permission from HM Revenue & Customs to issue the certificate so there may sometimes be a delay that is out of our control. Re-investment If you are using EIS investments to defer CGT, you would expect the deferred CGT to become payable when the EIS investments are sold in the future. It may be more attractive to re-invest the sale proceeds in new EIS opportunities, as this would further defer the CGT. Re-investing may also be attractive as a way of preserving the inheritance tax exemption, which is available for EIS shares that have been in your portfolio for at least two years. If you re-invest within 3 years of each sale, the two-year clock does not restart, so your IHT exemption would be re-established without having to wait for two years. Advisers We work with professional advisers and other intermediaries to help their clients understand the benefits and risks of EIS investing. We promise to respect and support the advisory relationship between our investors and their advisers. Charges Rockpool does not make any charges on investors. Instead it charges each investee company an arrangement fee at completion of the relevant investment and an annual monitoring fee thereafter. Rockpool will normally seek a performance incentive in the form of an option to subscribe for shares in each investee company. Investee companies are also required to pay any initial introducer fees, typically 3% of the amount invested initially. Safe custody Your money will be held in a custodian account until it is invested in EIS companies or paid to you. Any interest earned on your moneys in the custodian account will be retained by Rockpool. We will pay any fees or costs due for custodian and nominee services arranged by us. Your shares will be registered in the name of a nominee. You will be the beneficial owner of your shares and you will be entitled to request notice of company meetings and to vote at them. Risks Please think carefully about the risks involved with this investment. We have highlighted risks throughout this brochure, but there may be other risks that we have not considered. You must consider risks for yourself. Remember that past performance is no guide to the future. This investment is not suitable for money which you need or may need in the future to meet commitments for yourself or your dependants or to maintain your lifestyle. Unless you have an expert understanding of EIS investing, you should seek independent professional advice before investing. Rockpool is not able to provide you with advice.

11 Visit rockpool.uk.com Call

12 This document constitutes a financial promotion pursuant to Section 21 of the Financial Services and Markets Act 2000 and has been issued by Rockpool Investments LLP, which is authorised and regulated in the UK by the Financial Conduct Authority (FCA firm number ). Nothing in this document should be regarded as constituting legal, taxation, investment, or other advice and prospective investors should consult their own professional advisers before investing. If you invest through the Rockpool EIS Portfolio Service, you will do so under the terms and conditions set out in the application form provided by us. This document does not constitute, and may not be used for the purposes of, an offer or invitation to treat by any person in any jurisdiction outside the United Kingdom. This document and the information contained in it are not for publication or distribution to persons outside the United Kingdom. It does not constitute a public offering in the United Kingdom. Rockpool has taken all reasonable care to ensure that all the facts stated in this document are true and accurate in all material respects. Registered Office Rockpool Investments 52 Grosvenor Gardens London SW1W 0AU rockpool.uk.com team@rockpool.uk.com Rockpool Investments LLP is authorised and regulated by the Financial Conduct Authority registration number