Information for Clients

Pursuant to legislation governing the provision of crowdfunding services

Company Investown Technologies Ltd., ID 08667144 with registered office in Inovační 122, Hodkovice, 252 41 Zlatníky-Hodkovice, registered in the Commercial Register maintained by the Municipal Court in Prague in section C, file 322874 (”Company“), in this document “Information for Clients” summarizes the information for its existing and potential Clients.

The document contains information or refers to other documents and its purpose is to specify in more detail the conditions and manner of performance of the contract for the provision of crowdfunding services (').Covenant“). In particular, it is based on the General Terms and Conditions, which are available on the website (www.investown.cz). The provision of crowdfunding services is governed in particular by Regulation (EU) 2020/1503 of the European Parliament and of the Council of 7 October 2020 on European providers of crowdfunding services for enterprises ('ECSPR“).

This document contains information with which the Company is obliged to inform clients or potential clients from the public (”Client“) in the provision of crowdfunding services (”CF Services“) and services related to crowdfunding services, which is the operation of an electronic bulletin board to offer mutual investment between Clients (”Electronic bulletin board“), all within the framework of a web and mobile application operated by the Company (”Platform“).

  1. (CF services and services related to crowdfunding services hereinafter referred to as'ECSPR Services“).

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‍Basic information about the services that the Company is authorized to provide

Services provided

On 24 October 2023, the company received authorisation from the Czech National Bank (“CNB”) for providers of group financing services. The company is thus allowed to grant loans pursuant to Article 2 (1) (a) (i) of the ECSPR Regulation.

The Company is entitled to conclude an Agreement with the Client, on the basis of which it is entitled to provide the following ECSPR services through the Platform:

a) CF serviceswhich consist in matching the interests of Clients who are interested in investing in projects offered on the Platform (”Project“) and persons interested in obtaining financing for the implementation of their Projects (”Project Owner“), by granting credit (”Investment“).

b) Operation of Electronic Message Boardsthrough which the Company enables Clients to advertise their interest in selling Investments (or part thereof) originally provided to Project Owners to other potential Clients who, on the contrary, are interested in buying those Investments (or part thereof) from the original Clients.

Investments made under the ECSRP Services shall not be covered by a deposit guarantee scheme established pursuant to Directive 2014/49/EU or to compensation schemes established in accordance with Directive 97/9/EC. Thus, the return on the Investment is not guaranteed and the Investment is associated with certain risks.

Description of services

CF Services

The Company publishes a list of offered Projects on the Platform. The Client who is interested in investing in a particular Project will initiate the Investment by clicking on the “invest” button. This will redirect it to the page with the settings of the amount invested and the button “confirm the investment”. By clicking on this button, the Client makes a binding offer to invest.

By submitting a binding offer to invest, funds are written off from the account held within the Platform (”Investown Wallet“) and deposit them in the Company's account until the target amount of the Project in question has been met. Funds are provided to the Project Owner only when:

  1. the target amount of the Project is reached;
  2. the deadline for consideration by Clients has passed;
  3. The Project Owner shall provide the required documentation, including the documentation necessary for the establishment of the lien;
  4. a lien is established and duly registered to secure the Investment in the Project, unless otherwise agreed with the Project Owner.

After the loan is granted, the Project Owner begins to regularly send monthly interest on the loan to a special collection account of the Company, which will then distribute it to Investown Clients' wallets.

After the loan is due, the Project Owner sends funds in the amount of the loan granted (loan principal) to the Company's special collection account, whereupon the Company distributes these funds to Investown Clients' wallets.

Operation of Electronic Message Boards

The Client, who is interested in offering his Investment on the Electronic Bulletin Board, first chooses the Investment and the amount of the Investment that he wants to sell. He then chooses at what price he wants to sell the Investment or part of it. By confirming your interest in offering the selected Investment for sale on the Electronic Bulletin Board, the Investment will be displayed on the Electronic Bulletin Board to all other Clients. The Client hereby agrees to any offer to purchase the Investment made by the Client, which will be in accordance with its terms and conditions.

Until the Investment is sold, the Seller Client may at any time change the terms of the offer, in particular the amount of the Investment and its price.

Investments are displayed on the Electronic Bulletin Board in the order in which they were offered for sale. Clients are provided with a function that allows them to sort bids according to their chosen parameters (e.g. return or investment amount).

Clients can choose an Investment from the offer and choose how much of the Investment they wish to redeem. If Investing is selected, the Platform will automatically check the availability and conditions of the Investment. The client then confirms the choice.

Upon confirmation of the purchase, the contract for assignment of receivables is concluded and the Investment is transferred to the Client as a receivable and displayed in his Investment portfolio. At the same time, funds are transferred to the Seller Client from the Buyer Client's Investown wallet, with the fact that the fee for using the Electronic Message Boards service is automatically charged.

A Client who wants to buy an Investment from another Client must always manually search for and choose which Investment he wants to buy back. The electronic bulletin board is not able to automatically match the instructions and interests of individual Clients. Therefore, the electronic bulletin board is not a multilateral trading system within the meaning of Act No. 256/2004 Coll., on business on the capital market, as amended.

2. Selection of Projects for the Platform, their verification and credit risk assessment

The company specializes in real estate projects with a low degree of risk.

As part of the verification of the Project Owner, the Company shall carry out an identification and inspection in accordance with Act No. 253/2008 Coll., on certain measures against the legalization of proceeds of crime and terrorist financing, as amended, and then, through the CRIF system, will check the creditworthiness of the Project Owner.

The Company shall fix the price of Projects in accordance with Article 4 (4) of the ECSPR. As part of the pricing of Projects, the Company assesses comprehensive information about the Project Owner and the Project itself. The Company informs about the procedures by means of an overview table, which is attached to this Factsheet.

3. Further information on the provision of ECSPR services

Deadline for reflection

Unsophisticated Clients can take advantage of the cooling-off period during which they can withdraw their offer to invest at any time without giving a reason and without penalty. The cooling-off period begins at the moment when a potential unsophisticated Client makes an offer for the Investment, and ends after four calendar days from that moment.

You can withdraw the offer in the same way as the offer was made, namely by opening the Real estate/Project section and using the Cancel button. This button will show the Client a list of his investments from which he can withdraw. The withdrawal must then be confirmed by the Client.

It's communication

The company emphasizes online communication with Clients. Any Client may contact the Company with any question regarding the ECSPR service or investment instrument. The Company's identification data are listed above, contact and payment details are contained in the “Payment Information” section.

The company is obliged to ensure that additional records are kept of all services, activities and trades performed by it. The records also contain the interception of electronic communications related to the provision of services under the Contract.

Communication between the Company and the Client takes place in Czech or English.

Requesting Information from Clients (Investment Questionnaire)

Pursuant to Article 21 of the ECSPR, the Company is obliged to require certain information from Clients before providing ECSPR services in order to provide these services with professional care. Therefore, the Company reviews the Client's expertise and experience, in particular his financial background and investment objectives. The result of the examination is to determine whether Investments in Projects are suitable for Clients, or in what amount.

A prerequisite for the proper provision of ECSPR services by the Company is the correct and complete completion of the investment questionnaire. Therefore, we strongly recommend that you complete the investment questionnaire properly.

If the Client refuses to complete the investment questionnaire or if, based on the evaluation of the investment questionnaire, the Company considers that Investments in Projects are unsuitable for the Client, the Company shall notify such Client that investing through the Platform may not be suitable for him and warn him of the risks.

A Client who has refused to complete the Investment Questionnaire or has been assessed as unsuitable may invest through the Platform provided that he has explicitly confirmed through the Platform that he has received and understood the risk warning and confirms that he still wishes to invest.

Information about the Client's knowledge, experience and investment objectives is valid for 2 years. Information about the Client's financial background is valid for 1 year. After the relevant periods have elapsed, the Company will again request to complete, or update, the Investment Questionnaire.

It is in the Client's interest to inform the Company about the change in the information provided. In the event that there is a change in the information provided and the Client does not communicate this fact to the Company, it is considered that the information provided has not changed.

Contract concluded with the Remote Company

Within the meaning of Section 1837 (a) of Act No. 89/2012 Coll., the Civil Code, as amended (”OZ“) The Client expressly requests to commence the provision of ECSPR services on the basis of the Contract concluded with the Company before the expiry of the 14-day withdrawal period pursuant to § 1846 OZ. Therefore, the Client is not entitled to withdraw from the Contract concluded with the Company within 14 days from the date of conclusion of this Agreement or within 14 days from the date of delivery of the document by which the requested information was transmitted to him, if this day occurred after the conclusion of the Contract. If the Client withdraws from the Contract concluded with the Company, the Company may, in accordance with § 1834 OZ, require the Client to immediately pay the amount for the ECSPR service actually provided up to that time. The amount requested must be proportionate to the extent of the ECSPR service already provided.

4. Category of Clients

The Company treats all its Clients as so-called unsophisticated Clients. The unsophisticated Client uses the highest degree of protection when investing.

5. Description of risks associated with ECSPR services

Investing through ECSPR services is associated with risks that may affect the profitability or loss of the respective Investment. With each Investment, there is a risk that the Client will not achieve the expected return or lose part or even all of the invested amount. Accepting these risks, the Client acknowledges at its sole discretion that the Company is in no way liable for the Client's erroneous investment decisions.

The Client acknowledges that the higher the risk of the Investment, the higher the possible profit, but also the possible loss. In most cases, the risk of each Investment also decreases with its duration, that is, with the length of the so-called investment horizon. However, no investment horizon guarantees a significant reduction, or even a complete elimination of risk. Also, the income from loans made in the past period or the history of the Project Owners is not a guarantee of future revenues. Special risks may also be associated with the tax consequences of investing through ECSPR services. The Client is always solely responsible for fulfilling the tax obligations related to the Investments.

The risks associated with investing through ECSPR services can be mitigated through proper collateralisation of the loan. To this end, the Company requires that Investments in all Projects offered on the Platform be secured by a lien on the real estate, or by an additional lien against the Project Owner.

The list below contains only basic information on the risks that may be associated with investing through ECSPR services:

Project Risk

They are the risks associated with the Project and which may cause it to fail. These risks may in particular be:

  1. Project dependencies, such as financing, legal matters, licenses, copyrights;
  2. the occurrence of adverse scenarios with a negative impact;
  3. (technological) development of competitors or competing products; or
  4. risks arising from the person of the Project Owner.

Sectoral risk

These risks can be caused, for example, by changing macroeconomic circumstances, falling demand and dependence on other sectors. Sectoral risk refers to both the possibility of Project failure and the risk of a decline in the value of the pledge.

Risk of failure

The risk that insolvency proceedings may be initiated in connection with the Project or the Project Owner, and other events relating to the Project or the Project Owner that may result in the loss of Investment for Clients. These risks can be caused by a number of factors, including, but not limited to: (severe) changes in macroeconomic circumstances, poor management, lack of experience, fraud, financing inappropriate to the nature of the business, unsuccessful launch of the product, lack of cash flow.

Risk of lower, delayed or no returns

The risk that returns will be lower than expected, that they will be delayed or that interest will not be paid. This risk is controlled to some extent by setting up a pledge.

Risk of Platform Failure

The risk that the Company will be temporarily or permanently unable to provide its services.

Liquidity Risk Investments

The risk that Clients will not be able to sell their Investment. The Company does not guarantee the liquidity of Investments under the Electronic Bulletin Board in any way.

Other risks

Risks that are, for example, beyond the control of the Project Owner, such as political and regulatory risks.

6. Prices of services

The provision of CF service is not charged to the Client in any way. The Project Owner then pays the Company 3% of the total amount of the loan granted and 0 - 2% p.a.

Electronic bulletin board service is charged to Clients at a rate of 0.9% - 2% of the total trade volume (according to the traded Project). The fee in this case is paid by the Seller Client.

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7. The Company's approach to reducing conflicts of interest in the provision of ECSPR services

When providing services, the Company acts honestly, fairly and professionally in accordance with the best interests of Clients and Project Owners. For this reason, when providing ECSPR services, the Company detects and manages conflicts of interest in accordance with the principles established by the legislation and takes the necessary measures to limit any negative impact on the interests of Clients to the greatest extent possible.

Conflicts of interest in the provision of ECSPR services may occur in particular between:

  1. Companies and Clients or Project Owners;
  2. Clients and Project Owners;
  3. between Clients or Project Owners to each other.

In order to limit the occurrence of conflicts of interest, the Company shall:

- an organisational structure in such a way that personnel separation of individual organisational units creating possible conflicts of interest occurs in such a way as to effectively prevent the undesired flow of information and its possible misuse (the so-called “Chinese walls” system);

- ensuring the functional and organizational independence of individual organizational units that have sufficient material and organizational conditions for the objective performance of their activities;

- introduce remuneration rules for executives and employees that are not based on quantitative business criteria and also take into account compliance with relevant legislation, fair dealing with Clients and the quality of services provided. The remuneration structure is set in such a way that executives and employees are not motivated to prioritize the interests of the Company or certain Clients over the interests of any Client or Project Owner;

- a supervisory system set up within the internal control system (compliance) over those involved in providing ECSPR services to the Company.

If the Company detects a conflict of interest, the Company shall apply the following procedures in particular to resolve it:

  1. notify affected Project Owners and Clients in a clear and understandable manner;
  2. decide on technical or other arrangements for the provision of ECSPR services to enable effective management of conflicts of interest;
  3. cancel or suspend selected functionality of the ECSPR service concerned;
  4. take other appropriate measures with regard to the interests of Project Owners and Clients.

8. Information to protect clients' assets

In order to protect the Client's funds, the Company primarily takes the following steps in this sense:

- keep such records, in particular in the sense of accounting records, which consistently ensure the holding of funds for one Client from funds held for other Clients as well as from their own funds;

- carries out regular reconciliations of accounting and other mandatory records relating to Clients' funds;

- provides the Client with ongoing information on the funds held on his Investown wallet.

The funds entrusted by the Client, including those that may be obtained for the Client as part of the provision of ECSPR services, can generally go into the administration of a third party, which the Company uses in the performance of its obligations. These are persons whose use is necessary for the proper provision of ECSPR services, in particular in the sense of maintaining Investown Wallet with Client Funds.

The Company accepts the Client's funds in accounts held in the name of the Company cooperating with the bank (credit institution), which is currently:

Česká spořitelna, a.s., ICČ: 452 44 782, registered office Olbrachtova 1929/62, 140 00, Prague 4, Czech Republic registered in the Commercial Register maintained by the Municipal Court in Prague, section B, file 117, DIC: CZ699001261, E-mail: csas@csas.cz, Internet address: https://www.csas.cz/

The Company does not use funds that are part of the Client's property for its own purposes. However, the Client's funds may be used to settle the Investment made by the Client.

9. Payment Information

Bank connection of the Company for Client Accounts:

For deposits in CZK: IBAN: CZ74 0800 0000 0000 8887 7762

BIC: GIBACZPX

For deposits in EUR

IBAN: CZ08 0800 0000 0000 0921 9252
BIC: GIBACZPXXXX

10. Complaints and complaints

Should there be cases where the Client feels that ECSPR services are not being provided with proper and professional care, the Company refers the Client to its rules for filing complaints and claims available on the website (www.investown.cz).

These rules ensure that the Client is always satisfied if his complaint or complaint is justified, and the Company has feedback for the continuous improvement of its services.

Applicable law

Legal relations between the Company and the Clients on the basis of the Contract are governed by the legal order of the Czech Republic, in particular Act No. 89/2012, Coll., the Civil Code, as amended and directly applicable regulations of the European Union, in particular the ECSPR. If the dispute is resolved by judicial means, the courts will be competent to resolve the dispute according to local and substantive jurisdiction within the meaning of Act No. 99/1963 Coll., the Code of Civil Procedure, as amended.

Data on supervisory authorities

Oversight of the Company's activities as a future ECSPR service provider shall be exercised by:

Czech National Bank

Address: Na Příkopě 28

115 03 Prague 1

The manner of handling the Client's complaint does not in any way limit the possibility to file a motion to initiate proceedings before the court, to file a complaint with the Czech National Bank, as the authority exercising supervision of the financial market in the Czech Republic (contact details:

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INFORMATION ON PROJECT EVALUATION PROCEDURES AND PROJECT OWNERS

Credit score calculation information;

The Project and Project Owner Evaluation Society uses a model based on expert estimation. The Company assesses each Project and Project Owner individually on the basis of submitted documents and on the basis of the Company's experience and knowledge. The company has established criteria on the basis of which certain characteristics of Project and Project Owners are evaluated as unacceptable.

The Project and Project Owner Evaluation Company uses information supplied by Project Owners, information from public registers, and information otherwise publicly available. The company does not use automated models to calculate credit scores.

The company calculates credit scores based on the following criteria:

  • Profitability, indebtedness and solvency of the Project Owner's business
  • Project Owner Cash Flow
  • Information about the Project Owner using the CRIF system
  • Project Owner Failure History
  • Length of business of the Project Owner, his/her experience and knowledge with the industry
  • The Company's previous experience with the Project Owner

These criteria are rated 1 - 5 points.

Based on the calculation of the credit score, the Company obtains information about the economic status of the Project Owner. The result of the credit score does not affect the maximum amount and duration of the loan.

The Company updates the credit score based on changes in information and documentation communicated to it by the Project Owner or learned in another credible manner.
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Information on the management of the models in use, including their monitoring;

The Company monitors the effectiveness of its procedures for evaluating Projects and Project Owners. The company shall evaluate its procedures once a year and, where appropriate, adjust them.
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Information on the impact of each criterion on the determination of the price of the loan;

Only the following information is calculated in determining the price of the loan, that is, the determination of the interest rate:
Credit score result, Project evaluation, credit information, marketing point of view.
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Information on the impact of the individual criteria for the valuation carried out after the loan is granted;

The Company values loans both before and after the loan is granted in the same manner.

Information on the accuracy of collateral valuation and on the efficiency and possibility of reinsurance being enforced.

The Company assesses collateral information on the basis of documents submitted by the Project Owner, information available from public registers and other publicly available information.

At least once a year, the Company shall evaluate the collateral provided and, in the event of a significant decrease in the value of the collateral, take steps to remedy the situation.

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