Legal

The information contained in this website (the “Information”) has been prepared solely for informational purposes, is in summary form, and does not purport to be complete. In particular, the Information is not, and is not intended to be, an offer to sell, or a solicitation of an offer to purchase, any securities. Any offering and sale of securities by Blockwall Management GmbH or any related entity, should one occur, would be made only on the basis of certain transaction documents and, as the case may be, an offering memorandum and related governing and subscription documents pertaining to any such offering and sale. The Information does not provide and should not be treated as giving investment advice. The Information does not take into account specific investment objectives, financial situation or the particular needs of any prospective investor. No representation or warranty, either express or implied, is provided in relation to the accuracy or completeness of the Information. It should not be regarded by prospective investors as a substitute for the exercise of their own judgment or research. Prospective investors should consult with their own legal, regulatory, tax, business, investment, financial and accounting advisers to the extent that they deem it necessary, and make any investment decisions based upon their own judgment and advice from such advisers as they deem necessary and not upon any view expressed herein.

Blockwall Management GmbH (“Blockwall”, LEI: 391200YVTZ0CN8FUID66) considers sustainability risks as part of its investment decision-making process. Sustainability risks are environmental, social or governance events or conditions, the occurrence of which could have an actual or potential material adverse effect on the value of the investment. Blockwall considers sustainability risks as part of its due diligence process prior to any investment. This also includes an assessment of sustainability risks. Such assessment is being conducted through an informal process as appropriate in light of the circumstances of the individual case. The results of such assessment are taken into account when the investment decision is being taken. However, Blockwall remains free in its decision to refrain from investing or to invest despite sustainability risks, in which case Blockwall can also apply measures to reduce or mitigate any sustainability risks. At all times, Blockwall will apply the principle of proportionality taking due account of the strategic relevance of an investment as well as its transactional context.

Blockwall does not consider principal adverse impacts of its investment decisions on sustainability factors and, hence, does not use the sustainability indicators listed in Annex I of the Regulatory Technical Standards (Delegated Regulation (EU) 2022/1288, “RTS”) to identify and assess potential adverse impacts. Sustainability factors are environmental, social and employee concerns, respect for human rights and the fight against corruption and bribery.

Given that the SFDR, the Regulation (EU) 2020/852 (“Taxonomy”) and the accompanying RTS are relatively new legislative acts, there is very little practical experience or practice with regard to the application of their respective provisions. Therefore, substantial legal uncertainties would remain when applying those provisions to the strategies pursued by Blockwall. Moreover, the Fund pursues a venture capital strategy investing primarily in early stage, i.e., Pre-Seed, Seed and Series A rounds in portfolio companies originating primarily in the European Union and engaged in the distributed ledger technology (DLT) and blockchain sectors as well as related sectors with innovation capacity and growth potential. The Fund will mainly hold minority interests in its portfolio companies. Such minority interests are, however, generally not sufficient to encourage the Fund’s portfolio companies to collect and report the relevant data to Blockwall. Thus, it is currently not foreseeable for Blockwall whether the information for the identification and assessment of principal adverse impacts can be obtained regularly from all the portfolio companies.

If and to the extent that the legal uncertainties will be resolved and a practicable market and administrative practice will evolve in this regard, Blockwall will re-evaluate considering principal adverse impacts of its investment decisions in the end of 2024. In the meantime, Blockwall remains free in its decision to use part of the sustainable indicators listed in Annex I of the RTS and/or an own set of indicators.

As a registered alternative investment fund manager within the meaning of section 2 (4) of the German Investment Code (Kapitalanlagegesetzbuch, “KAGB”), Blockwall does not have and does not need to have a remuneration guideline or policy in accordance with the requirements of the KAGB.

Financial product: Blockwall Capital II GmbH & Co. KG (the “Fund” / der “Fonds”)

LEI: 3912000AEXEZ1GI1B538

The Fund considers certain environmental and/or social characteristics as part of its investment decisions and monitoring processes but does not seek to make sustainable investments as defined in the SFDR. The consideration of environmental and/or social characteristics is carried out both before and after an investment. For this purpose, information is initially and regularly obtained from the portfolio companies by means of qualitative queries. The Fund incorporates exclusion (negative screening) aspects during the decision-making process. Thereby the Fund considers several ESG themes to be the key to responsible investing. The actions and decisions described in the following section are each made by Blockwall for and on behalf of the Fund.

Der Fonds berücksichtigt bestimmte ökologische und/oder soziale Merkmale im Rahmen seiner Investitionsentscheidungen und Monitoring-Prozesse, strebt aber keine nachhaltigen Investitionen im Sinne der SFDR an. Die Berücksichtigung von Umwelt- und/oder Sozialmerkmalen erfolgt sowohl vor als auch nach einer Investition. Zu diesem Zweck werden zunächst und regelmäßig Informationen von den Portfoliounternehmen durch qualitative Abfragen eingeholt. Der Fonds bezieht Exklusionsaspekte (negatives Screening) in seinen Entscheidungsprozess ein. Dabei betrachtet der Fonds mehrere ESG-Themen als Schlüssel für verantwortungsvolles Investieren. Die in diesem Abschnitt beschriebenen Handlungen und Entscheidungen erfolgen jeweils durch Blockwall für den Fonds.

The Fund promotes environmental or social characteristics, but does not have as its objective sustainable investment.

The Fund promotes environmental and/or social characteristics by implementing certain investment exclusions (see section ‘Investment strategy’) during the decision-making process.

The purpose of the Fund is to build, hold and manage (including to divest) a portfolio of equity and equity-related investments in portfolio companies originating primarily in the European Union and engaged in the distributed ledger technology (DLT) and blockchain sectors as well as related sectors with innovation capacity and growth potential. The Fund intends to make its initial investments in the early stage, i.e., Pre-Seed, Seed and Series A rounds (including, for the avoidance of doubt, late seed rounds). As such, investments are expected to be spread across a wide range of economic activities. The Fund shall, in principle, pursue a long term and sustainable investment strategy.

The Fund is bound by the investment restrictions and limitations set out in the Fund’s limited partnership agreement and shall procure that such requirements, restrictions and limitations are complied with at all times. In particular, the Fund will screen each investment opportunity against its investment exclusions and no investments will be made in the area of such exclusions.

The Fund shall not invest, guarantee or otherwise provide financial or other support, directly or indirectly, to companies, including portfolio companies, or other entities whose business activity consists of:

Good governance practices are assessed through an informal process as appropriate in light of the circumstances of each individual case. Such practices include, in particular, sound management structures, employee relations, remuneration of staff and tax compliance within the portfolio companies. Moreover, the Fund will conduct regular monitoring of the good governance practices in its portfolio companies during the holding period. If the Fund becomes aware of severe governance issues, it will investigate them and work with all parties involved to find an appropriate solution.

The Fund will invest fully in line with its investment strategy and investment restrictions, i.e., will only make investments which are aligned with its environmental or social characteristics (i.e., its investment exclusions). The Fund does not make and does not intend to make sustainable investments within the meaning of article 2 no. 17 SFDR or environmentally sustainable investments within the meaning of Art. 3 Taxonomy; hence, no portion of its investments will be aligned with the Taxonomy.

The Fund has an increased awareness on the impact of environmental or social characteristics on risk management and thus on the value potential of investments. Accordingly, the Fund undertakes to monitor (compliance with) its environmental and/or social characteristics on an ongoing basis. Prior to making an investment, the Fund assesses the attainment of its environmental and/or social characteristics with respect to every (potential) portfolio company. During the holding period, the Fund uses the sustainability indicator ‘No investments in the area of investment exclusions’ and collects respective data at portfolio company level in order to monitor the ongoing compliance with its environmental and/or social characteristics. Moreover, the Fund consults with the portfolio companies in regular intervals and will carry out further checks if there are indications of potential issues with the Fund’s ESG approach. External monitoring mechanisms are not in place.

The Fund applies qualitative assessments with regard to its environmental or social characteristics (i.e., its investment exclusions).

The Fund conducts an initial assessment in the course of its due diligence. Through a questionnaire, the investment exclusions and good governance practices are identified and evaluated, and the results of such analysis are recorded. Based on the results of this assessment, the Fund identifies whether the environmental and/or social characteristics promoted by the Fund are met before making an investment. During the holding period, the so conducted assessment forms the basis to measure and monitor if the characteristics are continuously being met.

In order to attain each of the environmental and/or social characteristics promoted by the Fund, a questionnaire is completed by the (potential) portfolio companies in the course of the due diligence process conducted prior to each investment. Hence, most data is obtained from the (potential) portfolio companies. If necessary, some data may be estimated or supplemented by information publicly available. Further, qualitative statements of an environmental or social nature or relating to corporate governance are requested from the (potential) portfolio companies and then taken into account in the investment decision-making and monitoring processes. An internal or external review or verification of the data obtained will be carried out if misrepresentations are suspected.

The information collected from the (potential) portfolio companies is internally or externally verified only if and to the extent misrepresentations are suspected. Thus, it cannot be ruled out completely that false information may remain undetected in certain cases. As the Fund’s investments are made for several years, the Fund considers it a priority to establish and maintain a trustful working relationship with its portfolio companies in order to ensure compliance with the environmental or social characteristics promoted by the Fund (i.e., its investment exclusions). Further limitations, in particular with regard to the accuracy of the data and reliability of the data sources used, are not apparent at this time.

In order to attain the aforementioned environmental and/or social characteristics, the Fund carefully selects its portfolio companies during the investment decision-making process. An initial assessment of how an investment relates to the environmental or social characteristics promoted by the Fund (i.e., its investment exclusions) is carried out as part of the due diligence process and, where required based on the inherent ESG risk of the portfolio company. The Fund incorporates exclusion (negative screening with respect to its investment exclusions) as well as good governance aspects during the decision-making process. As a rule, purely qualitative statements of an environmental or social nature or relating to corporate governance are requested from the portfolio companies and then taken into account in the investment decision-making process.

Engagement is, in general, not part of the environmental or social investment strategy of the Fund. However, should the Fund determine any potential issues relating to the environmental or social characteristics promoted by the Fund or other ESG-related controversies in their portfolio companies, the Fund may engage the respective portfolio companies in discussions in order to resolve, reduce or mitigate any adverse effects. Yet, it remains at the sole discretion of the Fund to determine which efforts are appropriate and proportionate in light of the size and strategic importance of the respective portfolio company as well as the transactional context.

No index has been designated as a reference benchmark to meet the environmental or social characteristics promoted by the Fund.