Helping Investors to understand the risks

Investing in Advancr Bonds does carry risk and prospective Investors should consider carefully the following key risk factors in addition to the other risk factors presented in the Base Prospectus dated 26 April 2019, before making any investment decision.

Risk factors relating to Triple Point Advancr

Credit Underwriting

If the SMEs that lease assets or borrow money from Triple Point Advancr, fail to pay for the assets or the loans, our ability to pay interest and capital to Bondholders could be materially affected. Although we make provision for bad debts, if the level exceeded these predictions, it would impact Triple Point Advancr’s profitability and ability to pay interest and/or capital to Bondholders.

Insolvency

Investing in Advancr Bonds means that investors are lending money to Triple Point Advancr Leasing PLC. Investors will not become shareholders or have any ownership stake in the company. Instead, subject to the risks that we describe here, investors will receive interest and at the end of the term of each Advancr Bond (when it matures), their initial investment amount back. Like all businesses, Triple Point Advancr is vulnerable to financial difficulty and investing in Advancr Bonds involves the risk of Triple Point Advancr becoming insolvent. Should this happen, investors may lose some or all of their initial investment or any outstanding or future expected interest payments. Even though we have put what we believe to be comprehensive risk processes in place to help mitigate the risk of financial difficulty, it is important that investors understand that such a risk exists.

The management team

Triple Point Advancr’s ability to successfully operate and grow the business is largely dependent on the efforts, abilities and services of senior management and other key employees. Triple Point Advancr’s success will also depend on our ability to attract and retain qualified personnel. An inability to attract and retain qualified personnel could materially adversely affect our company. We have developed an important understanding of the industry in which we operate and any change in the composition of the management team could impact on the ability of Triple Point Advancr to continue to execute its business strategy successfully and, if this affected the revenue of the company, this could impact on its ability to make payments to Bondholders.

Competition for investment opportunities

Competition for attractive investment opportunities may lead to lower potential returns than expected from deals, which may affect Triple Point Advancr’s revenue. Triple Point Advancr may face competition from other entities as a result of such entities having significantly greater financial and/or technical resources or businesses which are more mature than Triple Point Advancr. In addition, such entities may have developed or marketed alternative financial arrangements that are more effective or less susceptible to challenge than those developed or marketed by Triple Point Advancr. These factors may render the business strategy less profitable.

Dealing with SMEs

SMEs are on average more risky counterparties than larger companies as they may be less prepared for the economic factors (such as interest rate changes, inflation, political and regulatory changes, economic uncertainties etc.) and company specific risks which they face.

Pipeline of new leases and lending opportunities

A strong pipeline of new leases and lending opportunities is an important part of generating enough revenue to cover overheads and make payments to Bondholders. Triple Point Advancr needs to time these deals in such a way that it has, at any one time, sufficient money to make any payments due to Bondholders. If we do not achieve this balance effectively, this could have an adverse impact on our ability to meet payments due to Bondholders.

Economic risks

The businesses which we lend to (or are entitled to receive payments from) are subject to UK-based economic risk. If there are adverse changes in the market or in the macro-economy, this could cause Triple Point Advancr to generate less income than expected which could in turn impact our ability to make payments to Bondholders.

New rules, regulations and laws

Triple Point Advancr will be under a duty to comply with any new rules, regulations and laws applicable to its operations. Compliance with these rules, regulations and laws could create additional burdens for the company and could have a material adverse effect on its profitability and ability to make payments to Bondholders.

Credit rating

At the date of this Prospectus, Triple Point Advancr has not been assigned a credit rating by any independent credit rating agency and, accordingly, the Advancr Bonds have not been assigned a credit rating by any independent credit rating agency. Accordingly, Investors will need to make their own assessment of the credit of the company and the other factors which may affect the value of the Advancr Bonds without the benefit of an independent credit rating.

Risk factors relating to the Advancr Bonds

Financial Services Compensation Scheme (“FSCS”)

Advancr Bonds are not protected by the FSCS. Therefore, if Triple Point Advancr were to become insolvent or go out of business, holders of Advancr Bonds may lose all or part of their investment in the Advancr Bonds and no government or other body would be required to compensate them for such loss.

There are two types of relevant FSCS protection that apply to an Advancr Bondholder: deposits and investments.

Deposit protection applies when money belonging to investors is held in the Client Account. With investments in Advancr Bonds, this occurs initially when investor money is transferred to us to make an investment and when interest repayments and the repayment of capital are being held on behalf of investors. While the money is in a Client Account (which is likely to be a short period) it is protected by the FSCS deposit protection which is currently £85,000 per person per eligible claim. This Client Account is operated by Triple Point and is held with the Royal Bank of Scotland PLC (RBS).

Investment scheme protection may be available in cases where loss is incurred by factors such as mis-selling or misrepresentation on our part, or on the part of our appointed representatives. The FSCS investment protection is currently up to £50,000 per person per eligible claim.

This is unlikely to significantly affect the risk that investors assume when investing in Advancr Bonds. The FSCS is a fund of last resort to cover any claims investors might have against a firm that is in default. For more detail on the FSCS and their eligibility criteria see their website http://www.fscs.org.uk/what-we-cover/eligibility-rules/.

Yield

The indication of yield stated within the Base Prospectus applies only to investments made at the issue price of the Advancr Bonds. An investment in the Advancr Bonds at a price other than the issue price of the Advancr Bonds could result in a yield on the investment that is different.

Transferability

Whilst the Advancr Bonds are transferable and whilst Bondholders may request that Triple Point Advancr makes their Advancr Bonds available for sale on the website for the original full face value, partial sales of Advancr Bonds are not possible or permitted and there is no guarantee that the Advancr Bonds will be purchased by other investors nor is there is any guarantee regarding the time it will take to complete the transfers or whether purchasers will be found either at all or at the original full face value.

No ready market in which the Advancr Bonds may be sold

No application has been made to any Recognised Investment Exchange for the listing of the Advancr Bonds and so there is no ready market in which the Advancr Bonds may be sold which may, therefore, make them difficult to sell.

Early repayment

Triple Point Advancr has the right to repay the Advancr Bonds early to wind up its business if that was preferable to carrying on, in accordance with the Terms and Conditions, and if this were to happen the length of an investment in the Advancr Bonds could be materially shortened, compared to the period over which Interest is paid.

Fixed rate of Interest

Advancr Bonds pay a fixed rate of Interest and there is a risk that a fixed rate will become less attractive if interest rates available elsewhere go up. Similarly, high inflation could adversely impact the real (inflation-adjusted) return to a Bondholder.

Concentration risk

The Advancr Bond is an investment in one company only, namely Triple Point Advancr.

Although Triple Point Advancr’s business model involves leasing and lending to a large number of SMEs, and therefore diversifying its own risks, an investment in Advancr Bonds is concentrated in one company and not an investment in a diversified portfolio.

Credit underwriting

Details of SMEs with whom Triple Point Advancr is dealing with may not be disclosed on a named or detailed basis to Bondholders because of confidentiality and other restrictions. To this extent, Bondholders may not, therefore, have an opportunity to evaluate for themselves such SMEs and, therefore, Bondholders will be dependent upon Triple Point Advancr’s judgement and ability in deciding which businesses to deal with.

IFISA legislation

The amount investors can invest into an IFISA each year is decided by the Government. Currently ISA investments are free from capital gains tax and income tax. These benefits may be changed by the Government in the future and investors should make sure that they understand any changes that are made. Once investors have invested the annual maximum they can’t make any further contributions in the tax year. This means that if investors withdraw money from their ISA they will not be able to pay it back in if they have reached their annual subscription limit. If investors decide to transfer an ISA from one company to another they will need to do this as an ISA transfer rather than take money out and pay it back in again. Investors can transfer cash to an IFISA from an existing Cash or Stocks and Shares ISA. If investors choose to transfer cash from a Stocks and Shares ISA, they may be required to sell current investments.

Changes in law, regulations or administrative practices

The structure of the issue of the Advancr Bonds is based on English law, regulatory and administrative practice in effect as at the date of this Prospectus, and has due regard to the expected tax treatment of all relevant entities under UK tax law and the published practice of HMRC in force or applied in the UK as at the date of the Base Prospectus Offer. No assurance can be given as to the impact of any possible change to English law, regulatory or administrative practice in the UK, or to UK tax law, or the interpretation or administration thereof or to the published practice of HMRC as applied in the UK after the date of the Prospectus.

The Security Trustee is not responsible nor liable for any loss incurred by Bondholders

The Security Trustee is not responsible, nor will it be liable, for any loss incurred by the Bondholders relating to a failure of the Company to make payments (whether of Interest or repayment of the original investment amount) to the Bondholders when due.