Information Memorandum - Foresight Group

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FORESIGHT’S KENT SOLAR PLANT AYLESFORD, KENT 5MW OPERATIONAL JULY 2011 06 FORESIGHT SOLAR EIS FUND 3
DEALFLOW Foresight has developed an attractive pipeline of solar investment opportunities through partnering relationships with developers and specialist construction firms, and from its network of contacts with property owners and professional advisers. The UK market for solar power is predicted to expand rapidly, with DECC estimations of between 7GW and 20GW by 2020, although growth could be constrained by lack of finance for projects. As a provider of such finance, with a track record in the solar industry, Foresight believes that it is an attractive RETURNS partner for developers and operators having already worked effectively with such businesses in UK, Italy and Spain. Foresight has a pipeline of UK projects totalling over £650m, has secured or is in the process of securing exclusivity on 300 MW of Solar Power Plant capacity due to be commissioned in the next six months and is in negotiations with a number of developers and their advisers regarding further suitable projects. The Fund is designed to provide attractive returns to Investors by combining Income from Investee Companies, which will be rolled up in order to achieve capital gains tax treatment on sale of the Investments, with initial tax relief of 30% relief from inheritance tax plus the opportunity to defer CGT. Illustrative investment returns to eligible Investors 1 Cost of Investment 100,000 Less income tax relief (at 30%) (30,000) Net Investment 2 70,000 Target investment proceeds assuming exit in three to four years 3 120,000 Total return on Net Investment 71.4% Average Compound Annual Return 4 14.4% Average Equivalent Annual Return (on Net Investment, assuming 45% income tax rate) 5 26.2% Average Equivalent Annual Return (on Net Investment, assuming 40% income tax rate) 5 24.0% Average Equivalent Annual Return (on Net Investment, assuming 20% income tax rate) 5 18.0% Notes: 1. We have assumed adviser commission applies for the illustrative investment returns table since these are the only terms where there is certainty. These terms assume tax relief of 100% on the amount invested, deduction of 5.5% initial charge and 0.5% trail per annum paid over 4 years. Differing terms to those assumed will alter the returns. Target Returns are quoted inclusive of all Foresight fees 2. Assumes single investment of £100,000 in EIS Qualifying Companies applied against an Investor’s 2013/2014 income tax liability. 3. Target proceeds (assuming all investment proceeds are realised by way of a sale of EIS qualifying Shares free of CGT) are shown net of all costs. Target proceeds are an illustration only and do not represent a forecast of returns. 4. Returns are calculated over a four year period and Foresight is confident that it will be able to provide an exit within three to four years. 5. Equivalent Annual Return is the compound return an investor would need to achieve from an equivalent investment (which attracts the relevant personal income tax rate) in order to achieve the same return as that projected. For Investors wishing to maximise capital growth and to realise their investment within four years, Foresight aims to deliver a capital return of 120p per £1 invested in the Fund within four years. If the planned level and timing of sale proceeds is achieved, then Investors benefiting from full EIS tax reliefs would achieve a tax-free cash profit of 71.4% of their net cost of investment which equates to an average compound annual return of 14.4%, or a gross average equivalent compound annual return of 24.0% per annum (assuming that the Investor’s marginal rate of income tax is 40%) or 26.2% per annum for Investors with a marginal rate of 45%. Interest earned on cash balances held in Portfolios will be added to the relevant Investor’s Portfolio. £ FORESIGHT SOLAR EIS FUND 3 07
Page 1 and 2: INFORMATION MEMORANDUM WITH APPLICA
Page 3 and 4: CONTENTS PAGE n EXPECTED TIMETABLE
Page 5 and 6: LETTER OF INTRODUCTION MAY 2013 DEA
Page 7: INVESTMENT OPPORTUNITY In order to
Page 11 and 12: LIQUIDITY If Investors need to real
Page 13 and 14: INTRODUCTION TO SOLAR POWER INVESTI
Page 15 and 16: Is the equipment reliable? Solar Po
Page 17 and 18: • Feed-in Tariffs (FIT) with Cont
Page 19 and 20: AN INTRODUCTION TO SOLAR POWER INVE
Page 21 and 22: Federico Giannandrea Partner Federi
Page 23 and 24: RISK FACTORS INVESTMENT IN SMALLER,
Page 25 and 26: Changes in legislation concerning E
Page 27 and 28: Qualifying Companies and an Investo
Page 29 and 30: 2.14 The Fund Manager will comply w
Page 31 and 32: Investor shall be entitled, as a ma
Page 33 and 34: to the Investor for any profit, com
Page 35 and 36: 18.3 The Fund Manager is covered by
Page 37 and 38: Foresight will bear any legal, acco
Page 39 and 40: “Investee Companies” companies
Page 41 and 42: APPLICATION FORM PRIVATE INVESTORS
Page 43 and 44: APPLICATION FORM AUTHORISED INTERME
Page 45 and 46: APPLICATION FORM ADVISER CERTIFICAT
Page 47 and 48: DIRECTORY FUND MANAGER & PROMOTER F

Information Memorandum - Foresight Group

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