Frequently Asked Questions
What is Audacia's 350 million EUR note programme?
Audacia principal activities to acquire investments (collateral) financed through the issuance of limited recourse listed debt obligations (Notes) to investors (note holders). The collateral of each Series of Notes comprises of cash held by the Company in segregated accounts for each series and debt instruments (securitisation bonds) issued by the Obligor of that series. The Notes are issued in one or more series of collateral backed dematerialised securities.
Audacia Capital (Ireland) PLC - who owns it and who are the directors?
Audacia is owned in trust by the Share Trustee, Waystone. The shares are held in trust for the benefit of an Irish charitable trust, making the structure bankruptcy remote and reducing potential conflicts of interest. The Directors are John Ferguson, Charles Goldsmith, Howard Chapman, Patrick Gibbons, Jamie Prins, and Matthew Tracey.
Company Funds
The Company banks with AA- rated tier 1 bank Northern Trust. All the funds are held in custodian controlled accounts, ringfenced by series and none of the Directors have direct access to any of the funds or authority to undertake transactions.
Can an investor come direct to Audacia Capital?
Audacia Capital PLC does not deal directly with investors.
What is a Collateral Obligor or Collateral Manager?
Each Series is linked to an underlying Collateral Obligor, also referred to as a Collateral Manager, or Bond Owner. Each Collateral Obligor is responsible for the underlying activity, and performance of their own Bond. No Series is issued by Audacia unless and until the Collateral Obligor has passed a series of diligence and standard compliance checks.
What is a Corporate Bond?
A bond is simply an I O U. The Collateral Manager(s) borrow the proceeds raised from investors with a promise to pay it back at the end of the term of the bond. Along the way the Collateral Manager will pay a rate of interest (also known as the Coupon). The Collateral Managers will use the funds raised until they have to pay it back, to grow their business and reach a level where they no longer need to borrow.
What are the risks of a Corporate Bond
Put simply the risks are that the Collateral Obligor (the borrower) is unable to repay fully (or not at all) the funds they have borrowed. There is also the risk the underlying business may not perform as expected and may not be able to meet the interest payments during the term of the bond.
What checks are done on a new series?
Initially the Board of Audacia will undertake a diligence process on the underlying business (Collateral Obligor) and the personnel running it. After this a business plan, two years audited accounts and full financial projections are required to satisfy Audacia of the ability of the business / collateral obligor to be able to service the debt (pay its interest) and to repay the debt at maturity.
What is the role of Audacia?
Audacia is the Issuer only. Audacia has no involvement in the investment management of the underlying bond series. Audacia undertakes no regulated activity and any investor should undertake their own research before investing in any corporate bond as there are inherent risks with all bonds.
How long is the listing process?
A successful listing on the ISE will depend upon a number of factors including which exchange is used. Once a professional business plan has been presented, two years audited accounts submitted, and the document list for the diligence process has been supplied then a vanilla listing can often be achieved in around 6 - 8 weeks.
What coupon & term should we select?
Audacia is the Issuer only and cannot specify the variables that best suit your business. Our team will work with you to determine the level of coupon (taking into account, cash retention, operating expenses, and marketing fees) which your business can sustain and which provides a realistic ability to repay investors.
Do the Notes issued have a "Target rate" or a "Fixed rate" of Interest?
All notes issued by Audacia Capital pay a quarterly income to investors. The target rate is set by the underlying bond manager and is a target rate which normally will be the amount investors receive. In some cases, as per the conditions of the notes and as set out in the relevant Listing Particulars.Audacia will exercise its right to make deductions from the interest to recoup amortised set up costs of the notes.
What security does the Issuer have to ensure bondholder funds are secure and interest will be paid?
The bond manager can only deploy bondholder funds subject to satisfying the Board of the PLC and the Security Trustees (Waystone) processes and criteria. This includes a demonstrable means to pay interest and recover loans, interest and fees.
What security do noteholders have on how their funds are invested
Audacia requires full transparency with regards to how and where the Collateral Obligor invests noteholders’ funds. Our Corporate Services Provider are Trustmoore who have included within its criteria a quarterly update on performance, financial measurements, progress on projects, and any other material updates so the the Board of Directors have a picture of the state of the series.
How is income generated to pay returns?
As explained in the listing particulars, strict criteria on the type and nature of loans is in place, so as to ensure there is sufficient returns and working capital to deal with coupon payments and repayment of the bond sums. Each Collateral Obligor business must be able to show that it can generate sufficient income to meet coupon obligations to investors along with the operational fees of the bond. The criteria and underwriting process along with the <8% cash retention also helps to ensure there is enough equity accessible should a borrower default on a loan..
Is there liquidity?
Investing in a Bond for a fixed term usually requires the investor to go the full term. Notes issued by Audacia Capital (Ireland) are available to be traded, and the issuer retains up to 8% of the Bonds funds in Cash to provide additional liquidity and security to investors. Investors must be aware that exiting a Series before the end of the term is not a right and there is no obligation to accept a redemption request before the maturity date. Should such a request be accepted, investors must be made aware that the investment will incur penalties which can be significant, especially in the early years.
Does Audacia Capital (Ireland) PLC have management accounts?
Audacia Capital PLC is a company specifically set up to issue notes under the Audacia Capital PLC note program. It is owned within a charitable trust and is not used as a trading vehicle. Following formal approval with the Central Bank of Ireland in March 2018, Audacia Capital (Ireland) PLC has to prepare its Audited Accounts in each June and to have them completed by the May of each following year. Our Auditors are EisnerAmper and they undertake this audit process and ensure compliance with the Irish Company and International Accounting standards.
Does Audacia have Audited Accounts?
YES. Audacia Capital (Ireland) plc is a publicly listed company and as such must comply with Irish company law and is subject to a full annual audit of accounts, management policies, and safeguards and controls. Audacia's financial year ends June 30th each year with audits required to be filed by March of the following year. Audacia's latest audit can be obtained upon request to the Executive Board.
Where can the performance of a Bond be found?
Audacia Capital (Ireland) plc is the issuer only and does not manage the bonds. However as above we monitor the activity of each bond to ensure the funds are being used in accordance with the Bond mandate and the stated activity in the relevant listing document. We can put investors in direct touch with the Series owners (collateral obligor) but in general the Bond will always be valued at 1 unless there is any impairment. This means that £10,000 lent to the bond will always be worth £10,000 unless there is a declared impairment that affects the Bond's ability to repay its borrowings. Impairments, defaults or any material information that could affect an investors decision to buy or sell a listed security must be declared to the relevant exchange in a public notice.
Does Audacia help Bond owners raise funds?
The short answer is NO. Audacia is the notes issuer and favouring any bond over another would be a conflict of interests. If you are reliant on Audacia for the fund raising as well as issuing the notes then we are not the right company for you. We do however have extensive contacts in the fund raising space and are able to make introductions to third party businesses with which you can make your own commercial arrangements with.
Are the bonds rated?
Audacia Capital (Ireland) plc is no longer rated as of June 2024. Although previously rated BBB the European Ratings Agency that undertook the rating stopped providing public ratings.