ToGatherHomes 1A

Risk: The SKYE REAL ESTATE team might not have (proper) knowledge of the market and/or make incorrect forecasts.
Consequence: If the team does not have sufficient knowledge of the market, it could set incorrect targets. This could lead to a lower valuation in the event of a possible exit because the business plan could not be executed as planned. In that case, there could be lower or even non-existent returns. In the worst case, there could even be a liquidation and bankruptcy of the company, with partial or complete loss of the invested capital. Note: The company has conducted extensive market research to understand customer needs and preferences. It has developed a clear value proposition and communicates it effectively. Feedback from every housing project that uses the company's service offering will be collected and the company will act on this customer feedback to improve the offering. The company will use targeted marketing strategies to educate and attract early adopters. The offering can relatively easily be adapted to international markets for expansion and coverage. The current strong demand for affordable and sustainable housing is expected to continue and grow, meaning that once the initial adoption phase is over, market acceptance will be rapid. 

2. Risk associated with development delays 
Risk: Delays in the development cycle of the digital design library and digital infrastructure.
Consequence: The company could miss market opportunities and launch deadlines. Development costs could increase. It could lose its competitive edge. Key team members could become frustrated and harder to retain within the company.
Observation: The company has divided development into manageable work packages with clear milestones and staffing requirements. It conducts regular progress reviews and adjusts plans as necessary. Buffer periods are built into schedules to deal with unforeseen delays. The Product Development Manager ensures effective project management and communication between team members. 

3. Risk associated with the size of the team 
Risk: Given the stage of development that SKYE REAL ESTATE is in, it is essential to have the right team for the future development of the company. If the company relies entirely on an indispensable person, there is a risk that this person will withdraw from the company. Consequence: If there is only one manager or key person and that person withdraws, the company is (temporarily) without management. In case of difficulties, no one would be able to represent the company to make decisions. 
Note: The funds raised will be used to increase the number of employees. 

Risk: Given the stage of development that project owner is in, it is likely that there will be a need for new financing. To complete the first phase of development, the company needs €500,000.
Consequence: If the company is unable to raise the amount required for the initial development of the company, (through the current offer, grants etc), there is a risk that it will be unable to cover operational costs, which could lead to delays in the development of products or services. This could lead to a loss of investor confidence and make it more difficult for the company to raise additional funds. On the one hand, there is thus the risk that the company will not find investors, which would lead to the dissolution or bankruptcy of the company, causing the investor to lose part or all of his investment. On the other hand, there is the possibility that the company will find new investors, which will lead to dilution, which will be even greater if there is a lower valuation than the one currently used. 
Note: The company has developed a detailed financial plan and budget. It will regularly monitor cash flow and adjust expenditure as necessary; it will implement cost control measures and prioritise essential expenditure; it will build up a financial reserve to meet unforeseen expenditure. As a low investment activity, the company has greater flexibility to adjust and manage cash flows. The company will look for various sources of finance, such as public funding, business angels, crowdfunding and venture capital. Each round of funding for product development will be followed by housing projects that are built with the company's services at an increased level of supply, generating revenue for the company. 

Risk: New laws or regulations affecting real estate transactions and social and affordable housing practices.
Consequence: The company could face increased compliance costs and possible legal problems and fines. Some of its offerings could become less attractive to customers, making it necessary to adapt to new laws and regulations.
Note: The company keeps abreast of local and regional regulations. It participates in industry associations. The company will work with legal and compliance experts to ensure regulatory compliance. The company's digital design library will be made up of components, meaning that it will be relatively easy to adapt its designs to new regulations, sizes and standards. 

2. Risk associated with competition 
Risk: Theft or copying of the innovative offering by competitors.
Consequence: The company could lose its competitive advantage and see its market share reduced. Brand reputation could be damaged. There could be potential legal battles and associated costs.
Note: The company is seeking available patents, trademarks and copyrights for the innovation. Non-disclosure agreements have been concluded with employees, partners and potential customers. The company consults with intellectual property lawyers to ensure ongoing protection and enforcement. 

Risk: The risk of insolvency means that the company does not have sufficient funds to meet its payment deadlines (cessation of payments). The company is currently in the process of the alarm bell procedure.
Consequence: If the company does not find alternative financing (shocked credit), it may go bankrupt. The insolvency or bankruptcy of SKYE REAL ESTATE may lead to lower or non-existent returns and in the worst case to a partial or total loss of the invested capital. 

Note: It should be noted that it is very common for start-ups to be in the process of the alarm bell procedure. 

1. Risk associated with the lack of guarantees. 
Risk: Neither the shares of SKYE REAL ESTATE nor the Participatory Notes of the TOGATHERHOMES 1A compartment of Spreds Finance provide guarantees of a return or repayment of the invested capital. 

2. Risk associated with the lack of a fixed return. 
Risk: Participatory Notes do not offer a fixed return. The return of the Participatory Notes depends solely on the performance of the Underlying Asset, namely the shares of SKYE REAL ESTATE.
Consequence for both risks: If the project owner's predictions do not come true (within the predetermined timing), there is a risk of lower or non- existent returns and, in the worst case, partial or complete loss of the invested capital. 
Note for both risks: Investors in Participatory Notes bear the same economic risk as if they were investing directly as shareholders of SKYE REAL ESTATE. 

Type 5 - Risk of failure of the financing vehicle
Risk: Although each Spreds Finance compartment is ‘bankruptcy remote’ (meaning that no other creditor can claim a right on or against this compartment) in relation to the others and in relation to the ‘general’ liabilities of Spreds Finance itself, as a result of (i) the terms and conditions of the Notes, (ii) the articles of association of Spreds Finance and (iii) Article 4 of the Law of 18 December 2016 on crowdfunding; there is a subsidiary risk of insolvency of Spreds Finance.
Consequence: Should such insolvency occur, Noteholders may be exposed to the risk of a significant delay in the recovery of their investment. Note: The probability of this risk occurring is extremely low given the structure and organization of Spreds Finance, in particular the compartmentalization mechanism and the "bankruptcy-remoteness" described above. Each participation taken or loan granted to a project owner is recorded in a separate compartment and is appropriately accounted for in the accounts, taking into account the fact that the accounts are kept by compartment. As a result of (i) the conditions attached to the issue of Participatory Notes, (ii) the articles of association of Spreds Finance and (iii) article 10 of the law regulating the recognition and delimitation of crowdfunding and containing various provisions relating to finance and notwithstanding articles 7 and 8 of the Mortgage Law of 16 December 1851, the assets of a particular compartment serve exclusively to guarantee the rights of investors with respect to this compartment. 

1. Risk associated with the absence of an organized exchange market for Participatory Notes 
Risk: Neither the project owner nor Spreds Finance organizes an exchange market for Participatory Notes. It is thus up to the investor himself to find a buyer for his Participating Notes. Given the absence of an exchange market for Participatory Notes, there is no way to adequately establish a comparative pricing methodology for Participatory Notes.
Consequence: A holder of Participatory Notes may not be able to find a buyer for the Participatory Notes it wishes to sell (at the price at which it wishes to sell). 
Note: The intention is not to sell the Participatory Notes but to sell the Underlying Asset, often on the occasion of the sale of the Company itself. 

Risk: Any decision by Spreds Finance to sell shares of SKYE REAL ESTATE is subject to the approval of the holders of Participatory Notes representing at least 75% of the outstanding Participatory Notes, unless Spreds Finance is required to sell them under a contractual or statutory provision.
Consequence: Investors thus bear the risk that the general meeting of the holders of Participatory Notes may refuse to approve the sale of the participation, in which case all investors are bound by this decision and thus must wait to obtain redemption of the Participatory Notes. 

Risk: Investing in shares of young companies entails the risk that a buyer for the shares will not be found, or not at a fair price yielding a market return, or that a buyer will not be found within a reasonable period of time.
Consequence: If no buyer is found for the holding, redemption of the Participatory Notes is not possible.
Note: Spreds Finance will make every effort within its powers to obtain the best possible price. 

Risk: Spreds Finance has not conducted an analysis of the proposed project or of the financial situation of the Company.
Consequence: Any investor considering subscribing to Participatory Notes should make its own analysis of SKYE REAL ESTATE's solvency, activity, financial situation and prospects.
Note: Any decision to invest in Participatory Notes should be based on a comprehensive analysis of the project and of this sheet of essential investment information. Spreds Finance's model does not provide for the presentation of analyzed projects to investors but allows investors to invest based on the information made available to them, after making their own analyses. 

Risk: There is no obligation for periodic reporting in unlisted companies (except for the cases provided by law, such as the annual general meeting of shareholders and an alarm bell procedure). While some entrepreneurs proactively communicate good and bad news (with a certain periodicity), others do not. As a (minority) shareholder, one cannot enforce reporting (other than in cases provided by law).
Consequence: If an entrepreneur does not do (periodic) reporting, there can be long periods during which investors have no insight into the (financial) state of the company. The lack of reporting does not in itself change the (financial) state of the company but can create a sense of unease among investors. If at some point a company has to file a procedure of judicial reorganization or bankruptcy, this can be a (big) surprise for the investor.
Note: Investors in Participatory Notes bear the same risk as if they invested directly in SKYE REAL ESTATE and became shareholders. However, Spreds, as a crowdfunding service provider, tries to encourage each project owner to report at least 2x per year.
 
To the best of the project owner's knowledge, there are no other material risks associated with its activities.