The first Real Estate backed token paying out dividends.

Transcription

1 The first Real Estate backed token paying out dividends. Light Paper: Version August, 2018 This Light Paper is provided for information only. It is not a definitive Offering Memorandum. Before making any investment decision investors should refer to the Offering Memorandum which will be issued by Leaseum Partners. That will be the only definitive source of information in relation to the Offering.

2 Executive Summary Introducing the Leaseum Token: bringing Real Estate investments into the digital age Leaseum Partners provides investors with flexible and efficient access to a portfolio of US Real Estate. Investors will receive quarterly dividends from rental income as well as benefit from the Real Estate appreciation itself. The focus will be on Commercial Real Estate in New York City, and targeted net annual return for investors is 10-12%. Beyond providing easy access to institutional grade, income generating Real Estate investments, Leaseum Partners takes this opportunity one step further. We utilize blockchain technology to make our fund liquid. How? By issuing our shares as regulatory compliant security tokens which will be listed on exchanges. By issuing ownership interests digitally as Tokens on the blockchain, we are able to leverage blockchain technology to provide investors with both improved liquidity and efficiency enabled by security tokens, and the stability and steady appreciation of Real Estate investments. Blockchain based Real Estate Investments combine the best of both Real Estate investment management and Blockchain technology, creating a uniquely attractive investment opportunity for a variety of investor profiles. Our Mission To bring accessibility, liquidity, efficiency and transparency to high quality Real Estate investments. 2

3 How the Leaseum Token will work 1 Investors must pass KYC (Know Your Customer) and AML (Anti Money Laundering) 2 The investment can be made in fiat or cryptocurrency 3 Investors receives Leaseum tokens with all associated rights 4 Leaseum Invests in Commercial Real Estate in NYC 5 Investors have the choice to receive their quarterly dividend in fiat or cryptocurrencies 6 Investors can sell or trade their tokens at any time on 7 At termination, investors will have the option to redeem the tokens and receive the potential capital gains. 3 4 regulated security token exchanges or Peer-to-Peer

4 The Real Estate Team David Dahan is Leaseum Partners Real Estate Chief Investment Officer. With over 25 years of experience, he was previously at Aviva Investors where he served as Head of Listed Real Estate Securities, co-head of Alternative Income Solutions (Managing Director Real Estate, Infrastructure), and was a member of the Real Estate Executive Committee. As a member of Aviva Investors Real Estate Executive Committee, he has had a wide range of responsibilities, including leading strategic and corporate development, creating and growing a number of new businesses, and leading real-asset based income strategies, private equity, listed real estate securities, infrastructure and structured finance investment businesses and teams. Michael Chetrit of the Chetrit Organization is Leaseum Partners portfolio manager. Leaseum will invest focusing on commercial Real Estate in high income producing assets with potential for enhancement in New York City. The Chetrit Organization is one of the most recognizable names in the American Real Estate market, and has held, developed and managed some of the most iconic buildings in the US. From the former headquarters of Standard Oil, to the Tiffany s building on Fifth Avenue to the Willis Tower (formerly Sears Tower) in Chicago, once the tallest building in the world. Current tenants in Chetrit owned properties include some of the biggest brands in the world: L Oreal, Citibank, Capital One, and WeWork. The Offering Leaseum Partners is raising a $250M fund to invest in Commercial Real Estate in New York City, United States. The fund will distribute rental income generated from the portfolio holdings to token holders. Leaseum Token Smart Contract running on the Ethereum blockchain will automatically make quarterly distributions to investors. Unlike many other cryptocurrencies, which are extremely volatile, Leaseum Tokens will be backed by physical property. This tie to property is expected to provide Leaseum tokens with improved price stability compared to other cryptocurrencies. 4

5 What is a security token? A security token is a digital asset that is subject to securities regulations. Security tokens serve as the intersection of digital assets (tokens) with traditional financial products. They can be backed by real assets such as Real Estate or commodities but also financial assets such as equity or debt. Security Tokens come with several benefits, including but not limited to: Increased liquidity: Security tokens are tradable on the secondary market at any time on exchanges and peer-to-peer around the world 1. Trades are no longer tied to traditional trading hours trading is open 24/7/365. More inclusive: It is more cost effective to issue and manage security tokens than it is for traditional securities. This means smaller investments are possible and a wider range of investors can access opportunities that used to be reserved exclusively to institutional investors and high net worth individuals. Lower Costs: Token issuance and trade execution are disintermediated, removing the costs imposed by middle men. Furthermore, smart contracts will help lower costs even more by removing the utility of middle and back offices who have historically been needed to deal with securities lifecycle events. Automated compliance: Embedded code in smart contracts allow regulatory compliance to be automated. This leads to faster KYC (Know Your Costumer) and AML (Anti-Money Laundering) completion and, ultimately, faster deal execution. In addition, because Security Tokens are registered on a distributed ledger, there is no need for conventional clearing houses. Leaseum Tokens will grant their holders three main rights: 1. Income Distribution Rental income will be distributed to token holders in either traditional currencies (USD or EUR) or cryptocurrencies (Ethereum (ETH) or Leaseum). The distribution of the Net Rental Income will be as follows: At least 80% of the Net Rental Income will be allocated to token holders and paid out every quarter. Out of the 80%, up to a 15% cash reserve could be used for Leaseum token trading purposes. The trading reserve will be used to purchase discounted Leaseum tokens on the market if the opportunity arises. It is held on behalf of token holders, belongs to them, and will be reflected in the token s value. Up to 20% will be retained by Leaseum Partners as performance fees. 2. Voting In the event of the token trading at a severe discount to the portfolio s net asset value, an early liquidation vote will be triggered. The token holders will be asked to vote for or against the fund s liquidation. 3. Redemption 20% Leaseum Partners performance fee up to 15% in cash reserve 80% for token holders At any time during the life of the Fund, Token holders will be able to trade Leaseum Tokens on exchanges 1. However, 10 years after the Security Token Offering, each investor can choose individually to redeem their tokens. In which case Leaseum Partners will liquidate its Real Estate holdings via selling the buildings to generate potential capital gains. 1 Subject to liquidity provided by the exchange, which is not guaranteed. 5

6 Benefits of the Leaseum Token Leaseum Tokens offer investors the opportunity to add Commercial Real Estate to their portfolios via a liquid and registered investment vehicle. Access to high quality Real Estate investments in the world s most popular market, New York City Leaseum Tokens will give investors the unique opportunity to access Michael Chetrit and David Dahan s Real Estate investment expertise, with a target 10-12% annual rate of return in combined rental income and capital appreciation net of fees. Income Booster Rental income from the properties will be distributed to tokenholders in either fiat (USD, EUR) or cryptocurrencies (Ethereum or Leaseum Tokens) 2. Enhanced Liquidity Traditionally, investors joining a professionally-managed Private Equity Real Estate fund would have the possiblity to redeem their assets only after 5-10 years. Since Leaseum tokens will be traded on exchanges, investors will be freed from the traditional 5-10 year lock up periods 3. Real asset-backed robustness As Leaseum Tokens are backed by Real Estate, they are more insulated from the volatility of cryptocurrency markets solving one of the key problems investors are facing with cryptocurrencies. Improved portfolio diversification Leaseum Tokens offer exposure to real assets which are uncorrelated to stocks and bonds. This will allow a traditional portfolio to have an enhanced risk diversification and will lead to better risk-adjusted returns (ie. higher Sharpe ratio). Cutting edge financial engineering To further ensure stability, if cryptocurrency market forces cause Leaseum Token s price to diverge from its net asset value (NAV), investors will benefit from innovative financial engineering through a mechanism called the Smart NAV Tracker. This mechanism s number one objective is to maintain a stable relationship between the token s price and its NAV over time, and thus incentivize the token s price to steadily increase in line with its NAV. This innovative algorithm will also take advantage of market volatility to grow both the token s intrinsic value and its yield for token holders. Improved transparency As Leaseum Tokens will use the Ethereum blockchain, they will offer maximum transparency to token holders since they will have access to verifiable historical information (distributions, fees, etc) through the Ethereum blockchain. Leaseum Tokens will appeal to investors from both traditional currency and cryptocurrency worlds, delivering benefits that combine the strengths of both currency types while avoiding the constraints of traditional Real Estate investments. 2 Local regulations may prevent cryptocurrency distribution, therefore you should seek external legal advice. 3 Subject to liquidity provided by the exchange. 6

7 The Leaseum Token Sale During the Security Token Offering (STO) period, investors will be able to buy Leaseum Tokens directly from Leaseum Partners. The proceeds of the token sale will be allocated as follows: The token will be distributed as follows: 97% Real Estate Fund 90% Investors 2% Set-up Costs 1% Cash reserve for Smart NAV Tracker Mechanism Up to 5% Team Up to 5% Advisors *These splits are indicative, assuming the hard cap is reached. Key Facts Type of token Issue Price Total Fund Size Reserved Allocation for Online Sale Target Net Annual Return Dividend Distribution Distribution currency Term Fund Net Asset Value Publication ERC-20 $1.00 $250 million $50 million 10-12% Quarterly USD, EUR, ETH or Leaseum Tokens 10 years Quarterly 7

8 The Online Sale Out of the $250m Leaseum Partners total fundraise, $50m is expected to be available to investors during our Online Sale. $50m available to investors $250m total fundraise Fiat or Crypto investors looking to receive more information about Leaseum s Online Sale need to whitelist themselves on (see below). The sale will be open to qualified and accredited investors, both inside and outside the US. Early Investor Scheme: Whitelisted investors willing to invest a significant amount, in fiat or crypto, ahead of our Online sale, may be eligible for our Early Investor Scheme (by invitation only). The Early Investor Scheme benefit will take the form of a multiplier applied to the quarterly dividends. More information will be available to whitelisted investors. 8

9 The Leaseum Partners Team The Leaseum Partners team comes from a variety of backgrounds: Real Estate, private equity, asset management, investment banking, capital markets, law and technology. Together the team combines more than 250 years of collective experience. Real Estate Team Michael Chetrit Portfolio Manager Principal at The Chetrit Organization, NYC-based single-family office managing several billion USD of Principal Real Estate assets in New York City, with several $1billion+ deals done in the US David Dahan Chief Investment Officer, Real Estate Former co-head Aviva Investors Alternative Income Solutions (Managing Director Real Estate, Infrastructure) More than 25 years of experience Executive Team Steve Sillam CEO, Co-Founder 13+ years of experience Private Equity, Real Estate & Consulting Monaco Resources Group, Kurt Salmon (now Accenture Strategy) Michael Abib Head of Financial Engineering, Co-Founder 8+ years of experience Multi Asset Quant & Risk Analyst Senior Vice President Citi, Credit Suisse, Societe Generale Lior Abehassera Head of Investor Relations, Co-Founder 12+ years of experience Equity Derivatives & Structured Products Institutional Sales Manager Director Natixis CIB, BNP Paribas Rui Soares CFO 18+ years of experience Investment professional with experience in M&A, ECM, Quantitative Proprietary Trading, Hedge Fund Management BNP Paribas, Commerzbank Julianne Sloane Analyst 4+ years of experience Head of Growth at VC backed PropTech start-up, Acasa London city organizer for start-up consulting event, House of Genius Julien Callede CMO 13+ years of experience Co-founded the retail brand MADE.COM, second fastest-growing tech company in the UK in 2014 and multi-awarded European success Advisor and investor in several start-ups and fast-growing scale-ups Sid Dadlani Investor Relations - APAC & ME 19+ years of experience Extensive experience in the institu- tional investment and fund raising functions focused on Real Estate, Private Debt and Infrastructure asset classes Worked with JP Morgan, NY for 10 years Robin Paynter Bryant Capital markets & Compliance 30+ years of experience Partner Trinity Column, Managing Director Industrial Bank of Japan (Mizuho Group), LCF E. De Rothschild, Nikko Securities, FCA CF1 & 13 Governance expert & ex-uk Regulatory Board member Advisors Gurvinder Dhaliwal Cross-asset Trading 15+ years of experience Managing Director Merrill Lynch Bank of America, Morgan Stanley Experience as equity derivatives trader and global macro hedge fund manager. Peter Lennon Legal and Compliance 30+ years of experience US qualified lawyer and US qualified accountant Experience in legal, compliance and regulatory matters involving complex financial issues. Forensic investigator at the FCA on cases linked to the LIBOR scandal. Barry Seeman Investor Relations 30+ years of experience Derivatives, hedging & alternative investments expert Managing Director Aegon Americas, Natixis Alternative Investments, Celestar Capital Advisors, Axa Capital Advisors, Citi Jeremy Bokobza Blockchain and Cybersecurity 13+ years of experience Lead blockchain developer at STRATIS Focusing mainly on wallets and privacy protocols Jonny Fry Blockchain and Asset Management 25+ years of experience CEO Team Blockchain, crypto economics, ICO and funds specialist CEO of Premier Asset Management ( 1bn+ under management, floated in London) Sydney Ifergan Marketing 10+ years of experience Online marketing and CMO for a large FX brokerage. Top 20 expert on ICO bench 9 Join our Telegram: https: /t.me/leaseumpartners

10 THIS DOCUMENT IS FOR DISCUSSION AND PRE-INFORMATION PURPOSES ONLY. NO PART OF THIS DOCUMENT IS LEGALLY BINDING OR ENFORCEABLE, NOR IS IT MEANT TO BE. THE INFORMATION CONTAINED HEREIN IS SUBJECT TO CHANGE. WHILST WE BELIEVE THAT THE INFORMATION PROVIDED BY THE COMPANY IS RELIABLE, ITS ACCURACY IS NOT GUARANTEED AND NO WARRANTY IS GIVEN OR IMPLIED. CERTAIN STATEMENTS, ESTIMATES AND FINANCIAL INFORMATION CONTAINED IN THIS DOCUMENT CONSTITUTE FORWARD-LOOKING STATEMENTS OR INFORMATION INVOLVING KNOWN AND UNKNOWN RISKS AND UNCERTAINTIES THAT MAY CAUSE EVENTS OR RESULTS TO DIFFER MATERIALLY FROM THE ESTIMATES OR THE RESULTS IMPLIED OR EXPRESSED IN SUCH FORWARD-LOOKING STATEMENTS. PLEASE DO NOT COPY OR DISSEMINATE ANY PART OF THIS DOCUMENT. NONE OF THE INFORMATION OR ANALYSES IN THIS DOCUMENT IS INTENDED TO PROVIDE A BASIS FOR AN INVESTMENT DECISION, AND NO SPECIFIC INVESTMENT RECOMMENDATION IS MADE. NOTHING IN THIS DOCUMENT SHALL BE DEEMED TO CONSTITUTE A PROSPECTUS OF ANY SORT OR A SOLICITATION FOR INVESTMENT, NOR DOES IT IN ANY WAY PERTAIN TO AN OFFERING OR A SOLICITATION OF AN OFFER TO BUY ANY SECURITIES OR RIGHTS OF ANY NATURE WHATSOEVER BELONGING TO THE ISSUER IN ANY JURISDICTION. TOKENS SHALL NOT BE OFFERED, SOLD OR TRANSFERED IN ANY JURISDICTION WHERE SALE OR USE OF DIGITAL TOKENS MAY BE PROHIBITED AND SHALL BE LIMITED TO ACCREDITED INVESTORS WITHIN THE MEANING OF RULE 501(A) OF REGULATION D OF THE SECURITIES ACT 1933 UNDER U.S. LAW OR ANY EQUIVALENT QUALIFICATION UNDER LOCAL LAWS. ANY POTENTIAL PURCHASER OF TOKENS MUST CONSULT THEIR OWN ADVISERS AS TO THE POSSIBLE LEGAL, TAX, ACCOUNTING, FINANCIAL CIVIL AND CRIMINAL CONSEQUENCES OF PURCHASING, HOLDING AND TRANSFERRING TOKENS UNDER U.S. LAW AND IN ACCORDANCE WITH THE LAWS APPLICABLE IN THEIR COUNTRY OF CITIZENSHIP, RESIDENCE OR DOMICILE IN ORDER TO ENSURE, IN PARTICULAR, THAT (I) THEY ARE LEGALLY AUTHORIZED TO PURCHASE AND/OR HOLD TOKENS, AND (II) THE PURCHASE OR HOLDING OF TOKENS IS NOT CONTRARY TO ANY OTHER STATUTORY OR REGULATORY RESTRICTIONS THAT THEY MAY BE SUBJECT TO. THE TOKENS CONFERS NO OTHER RIGHTS IN ANY FORM, INCLUDING BUT NOT LIMITED TO ANY OWNERSHIP, DISTRIBUTION (INCLUDING BUT NOT LIMITED TO PROFIT), REDEMPTION, LIQUIDATION, PROPRIETARY (INCLUDING ALL FORMS OF INTELLECTUAL PROPERTY), OR OTHER FINANCIAL OR LEGAL RIGHTS, OTHER THAN THOSE EXPRESSLY SET OUT IN THE WHITE PAPER AVAILABLE AT HTTPS: / PLEASE NOTE THAT THE RIGHTS INCORPORATED IN THE TOKENS ARE CONDITIONAL UPON COMPLETION OF THE PROJECT, MEANING THEY WILL ONLY BECOME EFFECTIVE AND ENFORCEABLE IF, AND WHEN, THE PROJECT IS FULLY DEVELOPED AND OPERATING. TOKENS HOLDERS ARE THEREFORE EXPOSED TO THE RISK OF NON-PERFORMANCE, NON-DEPLOYMENT, NON-IMPLEMENTATION OR IMPERFECT COMPLETION OF THE PROJECT. PURCHASING, HOLDING, OR USING TOKENS POSE SEVERAL RISKS TO THE PURCHASERS, IN PARTICULAR THAT OF LOSING ALL AMOUNTS TRADED FOR TOKENS, AS SET OUT IN THE WHITE PAPER AVAILABLE AT HTTPS: / BY PURCHASING TOKENS, YOU EXPRESSLY ASSUME AND ACKNOWLEDGE THESE RISKS. 10