The content of this promotion has not been approved by an authorised person within the meaning of the Financial Services and Markets Act 2000. Reliance on this promotion, for the purposes of engaging in any investment activity, may expose an individual to a significant risk of losing all of the property or other assets invested. CHIP CHIP HOLDINGS LTD INVESTMENT REPORT WWW.AVANTISWEALTH.COM
CHIP CHIP HOLDINGS LTD INVESTMENT REPORT OVERVIEW COMPANY NAME Chip Chip Holdings Ltd INVESTMENT AIM Chip Chip (CC) Holdings is one of the UK s leading premium producers of force dried wood fuel. The company manufactures and sells its force dried premium wood fuel across the mainland UK from its regional production plants. INVESTMENT TYPE Corporate Bond LISTED: EXCHANGE or NON-LISTED Listed: Channel Islands Stock Exchange WRAPPER TYPE Available in an ISA, SIPP, SSAS or direct cash. SPECIAL FEATURES Socially responsible investment 2
ABOUT THE INVESTMENT Chip Chip Holdings is one of the UK s leading premium producer of force dried wood fuel. Chip Chip manufactures and sells its force dried premium wood fuel across the mainland UK from its regional production plants. The two main sources of revenue for the business are: Wood chip fuel sales to high volume end user customers Payment of a 20-year government subsidy called the Renewable Heat Incentive (RHI) The RHI is a government subsidy paid on a quarterly basis for 20 years. This is paid directly to the company which is operating more than 11.2MW of performing boilers, set to increase to over 20MW in early 2017. Chip Chip is committed to the environment and reducing carbon emissions. The wood fuel is virgin, traceable, sustainable and processed to British Standards. About the bonds The bonds will provide a fixed annual income of 6% to investors, payable on a semi annual basis. The funds will enable Chip Chip to re-finance existing asset finance and expand its existing wood chip production business to a total of at least eleven plants throughout the English countryside. The current business has more than 30m worth of renewable energy assets, set to increase to over 46m once all sites are operational. A listed, freely transferable investment paying interest gross which can be held as a direct investment and is eligible for investments by SIPPs, SSAS, ISAs and Offshore Bonds. Repayment of principle and interest are made without deduction of tax. The bonds will be listed and are eligible assets under the Eligible Assets Directive and are transferable securities under UCITS rules. Although designed to be held to maturity, the bonds are available to be traded at any time throughout the term. WHY WE LIKE IT ISA-friendly socially responsible investment. DUE DILIGENCE We undertake thorough, lawful due diligence procedures and processes in relation to all investments within our portfolios. We have a risk averse appetite for any financial and regulatory risk(s) that could impact our business. This means that the avoidance of risk and uncertainty in these areas is a key company objective. Where possible, we are happy to share the original source material contained within our Due Diligence file. This is on the basis that the investor understands it was created for the sole purposes of Avantis Wealth Ltd and does not constitute advice from Avantis Wealth Ltd. You can request a copy of our Due Diligence & Risk Management Statement by emailing compliance@avantiswealth.com or by calling 01273 447299. For Chip Chip, Due Diligence available for review includes: Information Memorandum Security Trust Deed INVESTMENT RISK - GENERAL Investment involves risk. In general, you should only invest in financial products that you are familiar with and understand the risks associated with them. The investment risk described here is not exhaustive, you should carefully consider your investment experience, financial situation, investment objective, risk tolerance level and if you have one, consult your independent financial adviser as to the suitability of your situation prior to making any investment. INVESTMENT RISK - SPECIFIC Investments in Chip Chip are subject to risks in relation to: Renewable Heat Incentives (RHI) regime change - The government has announced that RHI income is set to decline significantly in 2017. However, boilers that have already been approved under the scheme will continue to receive the same level of income for the remainder of their 20 year term. Going forward this is a potential risk to revenue. Secondary Market for equipment - While the issuing company believes there is a viable secondary market for the boilers, predominantly due to the fact that the RHIs apply to the boilers even after they have been decommissioned and installed at a new site, there is no demonstrable proof of this secondary market at the present time. 3
F.R.E.S.H. INVESTMENT STRATEGY % F. > FIXED INCOME Term Deferred option Income option 5 years No Yes. Interest paid six monthly in arrears. R. > REWARDING RETURNS Return Option to roll up Capital Growth potential Bonus 6% p.a. No No No E. > EXIT STRATEGY Exit process Early exit / penalty if any Automatic exit upon maturity. Although designed to be held to maturity, the bonds are available to be traded at any time throughout the term. S. > SECURITY There is a charge over the company s assets which is pledged to the security trustee in favour of the bondholders. H. > HANDS-OFF No involvement needed, as the investment is held in a corporate bond. Updates Updates on the corporate bonds and company news are available on the investment provider s website. 4
WWW.AVANTISWEALTH.COM INVESTMENT REPORT COMPANY FACTS SENIOR MANAGEMENT TEAM Chip Chip is headed by seasoned corporate finance and renewable energy professionals with experience in running divisions of large corporations, as well as a sales team that has over 50 years of experience selling into the biomass market. MONEY FLOW The investor acquires the bonds by submitting an application form to the investment provider. Upon processing the application, the investor is subscribed for the number of bonds requested. Within 14 days of the maturity date, the investor s capital will be returned, plus any interest due up to the maturity date. MINIMUM INVESTMENT 10,000 GBP STRUCTURE UK based limited company LOCATION UK TERM 5 years WHY WE LIKE IT The business has more than 30m of renewable energy assets, set to increase to over 46m once all sites are operational. 5
FREQUENTLY ASKED QUESTIONS 1. 2. Q. Where will the bonds be listed? A. The bonds are listed on the Channel Islands Stock Exchange which is an HMRC Recognised Exchange with more than 2,000 listings and market capitalisation of more than 300bn. The bonds will also be simultaneously listed on the Frankfurt Stock Exchange to ensure a market maker can be engaged to provide liquidity. Q. What sort of security do investors have? A. There is a charge over the company s assets which is pledged to the security trustee in favour of the bondholders. 4. 5. Q. What is the role of the security trustee? A. If a potential issue arises within the structure, for example if the coupon cannot be paid, unless promptly rectified, the security trustees reserve the right to take control of the structure to protect the interests of the bondholders. This may include the realisation of the security if it is deemed necessary or appropriate. Other steps may involve such actions as the appointment of a receiver or a backup servicer to ensure that all outstanding monies are collected for the benefit of the bondholders. Q. What would I gain or lose in different situations? 3. Q. Who is the security trustee? A. The trustee is GRM Law Trustees which is part of GRM Law, a London Law firm established in 1784. A. Generally, securities are designed to redeem at 100% of the nominal value of the investment. The price each investor pays for the securities depends on the market unless the securities are bought at the issue price. Investors should be aware that the market price may be higher or lower than the maturity value. The difference between the purchase price and the maturity value is determined by normal market forces. The value of investments may fall as well as rise. WELCOME TO AVANTIS WEALTH ABOUT US Avantis Wealth is a specialist in high income, alternative investments. We help clients achieve market leading returns of 7%-15% per annum from their pensions, investments, and savings, potentially leading to greater financial security and a better quality of life. By investing in asset-backed opportunities and utilising our F.R.E.S.H. investment strategy, you may be making a welcome addition to your portfolio by diversifying your investments. At Avantis Wealth, we work hard so that you can make informed decisions with your money. OUR TEAM Work with Avantis Wealth and benefit from our strength of experience and understanding of property and assetbacked investments. The senior management team offers over 100 years of combined experience in property and investment. We are highly focused on achieving the very best from your investments. VALUES The relationship with you is the most important asset we have. Therefore, we work hard to earn and keep your trust. These four values underpin the decisions we make and the way in which our company operates. INTEGRITY RESPECT HONESTY RESPONSIBILITY 6
THE F.R.E.S.H. INVESTMENT STRATEGY Our F.R.E.S.H. investment strategy enables us to offer a comprehensive range of high return alternative investments to meet your financial goals. Investments selected using our unique F.R.E.S.H. criteria offer our clients the opportunity to significantly improve their income now or in retirement. F. R. E. S. H. % FIXED INCOME an income you can rely on REWARDING RETURNS typically 7%-15% annually, sometimes more EXIT STRATEGY knowing when the investment matures with confidence you can exit SECURITY to protect your capital in the unlikely event of a problem HANDS-OFF more time to get on with your life because you won t need to get involved THE ASTUTE INVESTOR CLUB The Astute Investor Club is for High Net Worth and Sophisticated Investors seeking high return alternative investments that can provide a transformational level of income. The club provides a program of expert alternative investment information, education, networking and support to help you take control of your alternative financial future. Astute Investor Club members enjoy a wide range of features and benefits: INVESTMENTS Complete access to all investments from Avantis Wealth Downloadable investment reports Complimentary pension review For qualifying investors, access to all Plutus Portfolio investments Pre-release information about new investment opportunities EVENTS Invitations to seminars Invitations to webinars Invitations to social and networking events EDUCATION AND INFORMATION Monthly enewsletter Quarterly Astute Investor Magazine Complimentary Special Reports Complimentary Investment Guides Investment reviews and trending topics BENEFITS Free to join 10% discount on costs of attending paid for events Complimentary copy of our new special report, How to use the F.R.E.S.H. Investment Strategy to achieve 7%-15% net annual returns JOIN NOW VISIT WWW.AVANTISWEALTH.COM/CLUB 7
Avantis Wealth Ltd. 8 The Drive Hove BN3 3JA www.avantiswealth.com invest@avantiswealth.com 01273 447 299 0800 612 0880 NOTICE TO INVESTORS This financial promotion is exempt from the general restriction (in section 21 of The Financial Services And Markets Act 2000 (Financial Promotions) Order 2005) on the communication of invitations or inducements to engage in investment activity on the grounds that it is made to a: Certified High Net Worth Investor (Section 48 of the Act), or Certified Sophisticated Investor (Section 50 of the Act), or Self-Certified Sophisticated Investor (Section 50a of the Act), or Members of an association of High Net Worth or Sophisticated Investors (Section 51 of the Act) Details of what is required to qualify as a certified High Net Worth Investor (Section 48) or a Self-Certified Sophisticated Investor (Section 50a) as above can be viewed in detail at www.avantiswealth.com/disclaimer. Any individual who is in any doubt about the investment to which this communication relates should consult an authorised person specialising in advising on investments of the kind in question. If you do not qualify in one of the categories above and have therefore received this communication in error, please delete it as any investment mentioned in this financial promotion is only available to investors who qualify in the specified categories. DISCLAIMER Avantis Wealth Ltd is not authorised or regulated by the Financial Conduct Authority. Avantis Wealth Ltd does not provide any financial or investment advice. We provide a referral to a regulated advisor who will offer appropriate advice, or to the company offering the investment who will determine your status and suitability prior to any offer being made. We strongly recommend that you see appropriate professional advice before entering into a contract. The value of any investment can go down as well as up and you might not get back what you put in. You may have difficulty selling any investment at a reasonable price and in some circumstances, it may be difficult to sell at any price. Do not invest unless you have carefully thought about whether you can afford it, whether it is right for you and if necessary consult with a Professional Advisor in accordance with the Financial Services and Markets Act 2000. This investment is not regulated by the FCA or covered by the Financial Services Compensation Scheme and you will not have access to the Financial Ombudsman service. Information is provided as a guide only, is subject to change without prior notice and doesn t constitute an offer of investment. 2017 Avantis Wealth Ltd. All rights reserved worldwide. VERSION: CCIR_JUNE_2017