Reg CF Investment Considerations, Disclosures and Risks

Prior to registering on the Castle Placement platform, and before making an investment commitment, you must consider the risks of investing in crowdfunded securities offerings and determine whether such an investment is appropriate for you. No SEC review is involved in Regulation Crowdfunding offerings. Your decision to invest must be based solely on your own individualized consideration and analysis of the risks involved in a particular investment opportunity posted on the Castle Placement platform.

Potential investors acknowledge and agree that they are solely responsible for determining their own suitability for an investment or strategy on the Castle Placement platform and must accept the risks associated with such decisions, which include the risk of losing the entire amount of their investment. Investors must be able to afford to lose their entire investment.

Castle Placement has no special relationship with, or fiduciary duty to potential investors, and investors’ use of the Castle Placement platform does not create such a relationship. Potential investors agree and acknowledge that they are responsible for conducting their own legal, accounting, and other due diligence reviews of the investment opportunities posted on the Castle Placement platform.

Neither Castle Placement nor any of its officers, directors, employees, agents, affiliates or representatives makes any warranty, express or implied, of any kind whatsoever related to the adequacy, accuracy or completeness of any information on the Castle Placement platform or the use of information therein. Investors are responsible for conducting, and may rely only upon, any legal, accounting or due diligence review they decide is appropriate. Investment products are not FDIC insured, may lose value, and are not guaranteed.

All securities listed here are being offered by, and all information included on this site is the responsibility of, the applicable issuer of such securities. You may not rely whatsoever on any steps Castle Placement may have taken to verify the adequacy, accuracy or completeness of any information.

As an investor, you are strongly advised to consult legal, tax, investment, accounting and/or other professionals before investing, and to carefully review all of the specific risk disclosures provided as part of any offering materials, and post any questions in the issuer’s comment section of their campaign page prior to making an investment.

Investments in companies on Castle Placement’s platform involves a high degree of risk, regardless of any assurance provided by company management. Every prospective investor should be aware of the risks involved.

There can be no assurance that:

  • a company will be successful, realize its objectives, or achieve its business plan
  • any projection or information provided by the company is accurate, has been validated, or is reliable
  • any investment purchased through the Castle Placement platform will maintain its value, be liquid or able to be resold
  • you will be able to sell you investment. A regulation crowdfunding investment may actually need to be held for an indefinite period of time.  Unlike investing in companies listed on a stock exchange where you can quickly and easily trade securities on a market, you may have to locate an interested buyer privately when you seek to resell your crowdfunded investment even after the one-year restriction expires, as there is not an established market for these shares. There is no assurance these securities will ever be publicly tradable
  • an investor will receive a return on or of any part of its investment

 

The following risks and considerations, among others, should be carefully evaluated before making an investment in a company on Castle Placement’s platform:

  • Investors may, and frequently do, lose their entire investment
  • Investments involve a high degree of risk, including early-stage and emerging technology companies
  • While targeted returns on the amount invested should reflect the perceived level of risk in the investment, such returns may never be realized and/or may not be adequate to compensate an investor for risks taken
  • There are numerous economic, legal and regulatory risks associated with crowdfunding
  • Past performance is not predictive of future results
  • While targeted returns should reflect the perceived level of risk in any investment situation, such returns may never be realized and/or may not be adequate to compensate an investor for risks taken
  • The timing of any return on investment is highly uncertain
  • Financial and operating risks confronting startups are significant
  • The startup market is highly competitive and only a very small percentage of companies survive and prosper
  • Companies often experience unexpected problems that frequently cannot be solved, including technology, product development, product adoption, financing, manufacturing, marketing, management and organizational dynamics
  • Substantial additional financing may be required, and private or public equity and credit markets, or other economic sources, may not be available on favorable terms, or at all
  • Changes in government regulations or policy, or failure to obtain required regulatory approvals, could impair or prevent the company from achieving its goals
  • Investment in new concepts and technologies are inherently risky
  • An investment in a single company does not benefit from the reduced risk that results from investment in a diversified portfolio of companies
  • The industry may experience rapidly changing technologies, and products or technologies may quickly become obsolete
  • Well-trained personnel may be scarce, including management, technical, scientific, research and marketing
  • A portion of your investment may fund the compensation of the company’s employees, including its founders and management. Due to inexperience, management may not be able to execute on its business plan. Additionally, unless the issuer has agreed to a specific use of the proceeds from the offering, management will usually have considerable discretion over how to use the capital raised. You may not have any assurance the company will use the proceeds appropriately. You should carefully scrutinize what the company says about how offering proceeds are to be used
  • Because the founders, directors and executive officers may be among the company’s largest stockholders, they may be able to exert significant control or influence over the company’s business and affairs and may even have actual or potential interests that diverge from those of other Investors.  This may worsen as time goes on if the holdings of the directors and executive officers increase upon vesting or other maturation of exercise rights under options or warrants they may hold, or in the future be granted. These people may also have significant influence over and control of corporate actions requiring shareholder approval, separate from how the other stockholders, including investors, may vote in a given offering
  • Investment opportunities posted on the Castle Placement platform, the adequacy of the disclosures, or the Fairness of the terms of any such investment opportunity have not been reviewed or approved by a state or federal agency
  • The issuing company will likely not have an internal control infrastructure and there cannot be any assurance of no significant deficiencies or material weaknesses in the quality of the financial and disclosure controls and procedures. If it were necessary to implement such financial and disclosure controls and procedures, the cost to the Issuer might even have a material adverse effect on the Issuer’s operations
  • Patent and intellectual property lawsuits may occur
  • Investor sentiments and preferences may change rapidly
  • Changing economic conditions could impair the company and significantly impact the success or failure of an investment
  • The company may not achieve its objectives due to a variety of unpredictable events including increased regulatory scrutiny, the stability and sustainability of growth in global economies, terrorism, or war
  • The valuation of a company is highly subjective
  • Investments in companies that raise capital on Castle Placement’s platform may be challenging to value
  • Unlike listed companies that are valued publicly through market-driven stock prices, the valuation of private companies can be difficult to determine and is often subjective – you risk overpaying for the equity stake you receive
  • Many investments on the Castle Placement platform represent minority stakes in privately held companies, the right to not yet created assets, or a debt interest
  • There may be little, or no, public information about the operating or financial history for companies that raise capital on Castle Placement’s platform
  • There may not be an efficient market, or any market at all, for a company’s securities or other source of arm’s length price information
  • Minority investments provide very limited rights to the investor, including rights to obtain information about the company and its performance, and voting rights
  • There may be additional classes of equity or derivatives with rights that are superior to the class of equity being sold through crowdfunding
  • Investments are subject to dilution, which is when early investors see a reduction in ownership percentage as new stock is issued to new investors
  • Minority equity stakes have neither the control characteristics nor the valuation premiums of majority or controlling stakes
  • Investors will be reliant on the management and board of directors of companies
  • The interests and motivations of other investors in the company may conflict with the interests of the investor
  • Your shares will likely be diluted when the company raises additional funds
  • The investor may not be able to obtain all information it wants regarding a company
  • The investor may not become aware on a timely basis of material adverse changes in the company or the investment
  • A company may not comply with all requirements mandated by federal laws permitting private companies to fundraise from retail investors on a broker dealer platform such as Castle Placement or crowdfunding portal, whether before, during or after its offering on Castle Placement
  • There are many tax risks relating to investments, which are complicated and difficult to address
  • Investors should consult their tax advisor for information about the tax consequences of purchasing equity, debt or other investment instruments offered on Castle Placement’s platform
  • Investors should consult their own professional advisors with respect to the tax consequences to them of an investment in a company under the laws of the jurisdictions in which the investors and/or the company are liable for taxation
  • Withholding and other taxes may be applicable
  • The investment may not be tax efficient for any particular investor, and no particular tax result is guaranteed, or may be achieved
  • Tax reporting requirements may be imposed on investors under the laws of the jurisdictions in which investors are liable for taxation
  • Investors should be aware that management tends to consider the investment and tax objective of its shareholders as a whole when making decisions on investment structure or timing of sale, and not the circumstances of any investor individually
  • Investors lack control and will not make decisions with respect to the company’s business and affairs.
  • Certain company information will be highly confidential and competitors may benefit from such information if it is ever made public – this could result in adverse economic consequences to the investor
  • Federal securities law requires securities sold in the US to be registered with the US Securities and Exchange Commission (“SEC”), unless the sale qualifies for an exemption. The Reg CF securities offered on the Castle Placement platform have not been registered under the Securities Act, and are offered in reliance on the crowdfunding exemptive provisions of Section 4(a) (6) of the Securities Act (and/or Regulation S promulgated thereunder). No assurance can be given that any investment opportunity will continue to qualify under one or more of such exemptive provisions of the Securities Act due to, among other things, the adequacy of disclosure and the manner of distribution, the existence of similar offerings in the past or in the future, or a change of any securities law or regulation that has retroactive effect
  • Information available to investors may contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, which do not relate strictly to historical or current facts
  • Forward-looking statements often include words such as “will,” “anticipates,” “estimates,” “expects,” “projects,” “intends,” “plans,” “believes” and words and terms of similar substance in connection with discussions of future operating or financial performance
  • Forward-looking statements often regarding the adequacy of funding to meet future needs, expected future revenue and expenses, the market for goods or services, or other similar matters
  • Forward-looking statements are based on management’s current expectations and assumptions regarding the company’s business and performance, the economy and other future conditions and forecasts of future events, circumstances and results
  • Forward-looking statements, as with any projection or forecast, are inherently susceptible to error, uncertainty, and changes in circumstances
  • Actual results may vary materially from those expressed or implied in forward-looking statements due to economic, strategic, political and social conditions, government regulation, errors in estimates such as in the expected market size, expected costs of bringing a product to market, expected timelines and resources required to complete projects, and other operational and financial estimates, recent and future changes in technology, services and standards, changes in consumer behavior, plans, initiatives and strategies, and consumer acceptance thereof
  • In addition, actual results may vary materially from those expressed or implied in forward-looking statements due to

changes in the plans, initiatives and strategies of the third parties that are necessary or important to the company’s success, competitive pressures, including as a result of changes in technology, ability to deal effectively with economic slowdowns or other economic or market difficulties, increased volatility or decreased liquidity in the capital markets, including any limitation on the company’s ability to access the capital markets for debt securities, refinance its outstanding indebtedness or obtain equity, debt or bank financings on acceptable terms, failure to meet earnings expectations or comply with federal, state and foreign regulations as they related to securities offerings and exchanges, the adequacy of the startup’s risk management framework, changes in U.S. GAAP or other applicable accounting policies, the impact of terrorist acts, hostilities, natural disasters (including extreme weather) and pandemic viruses, or a disruption or failure of the company’s or its vendors’ network and information systems or other technology upon which its businesses rely

  • Furthermore, actual results may vary materially from those expressed or implied in forward-looking statements due to changes in tax, federal communication and other laws and regulations, digital systems being compromised by hacking, forking and hostile take-over, changes in foreign exchange rates and in the stability and existence of foreign currencies; and other risks and uncertainties which may or may not be specifically discussed in materials provided to investors
  • Any forward-looking statement speaks only as of the date on which it is made – companies are under no obligation to, and generally they expressly disclaim any obligation to, update or alter their forward-looking statements, whether as a result of new information, subsequent events or otherwise

The foregoing risks do not purport to be a complete explanation of all the risks involved in acquiring equity or debt securities in a company on the Castle Placement platform. Each investor must read the relevant investment documents before deciding to invest in a company on the Castle Placement platform, and must seek their own independent legal and tax advice. 

CONTACT US

Hi. We're not around right now. But you can send us an email and we'll get back to you, asap.

Thanks, Ken

Ken Margolis | Managing Partner Castle Placement, LLC
1460 Broadway Street, Rte 400
New York, New York 10036
(212) 418-1188 | C: (516) 712-7784
kmargolis@castleplacement.com

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