Invest in the catalog of the Grammy-winning rock band Cage The Elephant

The Investment

What You're Buying

An equity interest in the entity, CTE Royalties LLC, holding rights to payments associated with the composition copyright, and associated royalty income, of a music catalog spanning four studio album releases from the Grammy-winning American rock band Cage the Elephant (CTE). This represents 100% of the seller’s co-publishing stake in the catalog, which equals 40% of the total publishing copyright and related royalty income of the full catalog.

CTE Royalties LLC will have the right to collect income from the catalog’s Mechanical, Public Performance, Sync, and Print royalty streams for all studio albums created before July 31, 2017 (all songs on all four studio albums). CTE Royalties LLC will collect these royalties in partnership with the largest music publisher in the world by market share—Sony/ATV—which owns another 40% of the catalog and is the administrative entity supporting it.

The band is represented by one of the most powerful talent management agencies in the world—Q-Prime Inc.—alongside such best-selling acts as Metallica and Red Hot Chili Peppers. 

Included Catalog

Historical Earnings Summary*

2017 Revenue: $314,685 (15.1% growth over 2016) 

3-year Average Revenue: $264,071 

  • 5-year Compound Annual Growth Rate: 14%  
  • 3-year Compound Annual Growth Rate: 15% 


Catalog Six-Year Earnings

Top Earning Songs

As of 12/21/2017

Earnings by Royalty Type*


(Representing the 40% portion of the catalog CTE Royalties LLC Intends to purchase)

Six-Year Earning Breakdown

Earnings by Royalty Type 2017

As of 12/21/2017

Streaming

The growth of the music industry is driven by activity on streaming music platforms. Catalogs showing growth in streaming formats are in-line with the broader music industry’s growth trends.

Streaming earnings for the CTE catalog are up 55% year over year.* Streaming went from contributing 25% of overall catalog earnings in 2016, to 34% of total catalog earnings in 2017.

(Streaming-derived mechanical and public performance royalties combined, represents the 40% portion CTE Royalties LLC intends to purchase)

  • Streaming 5-year Compound Annual Growth Rate: 51%
  • Streaming 3-year Compound Annual Growth Rate: 61% 

Projected Returns*

We’re forecasting an average 12-15% return over 10 years... starting at just over 9% the first year and growing to 18% by year 10. These figures include the proceeds of an anticipated sale of the catalog and return of capital to shareholders ager 10 years.

Based on an analysis of the CTE catalog’s last five years CAGR, combined with industry projections for the growth of streaming activity, the statutory increase in mechanical royalty rates, and anticipated release of new music and tour.

INVESTMENT TERMS

Per Unit Cost

All Access Investor Members: $3,635

Non-Members: $3,835

Amount To Be Sold

$3,453,250

Eligibility

Accredited Investors as defined under Rule 506(c) of the Securities Act of 1933, as amended.

Lock-up Period

12 Months (per Regulation D)

Income Distribution Schedule

Income to be paid semi-annually.

Tax Treatment

Investors are expected to benefit from pass-through Amortization Benefit on the purchase. This will be done for investors via K-1.

*Past performance is not a guarantee of future results 


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There are only 950 units available, and we expect this offer to fill up quickly, so please complete this form today.

Documentation

     Download: Operating Agreement (PDF)

     Download: Subscription Agreement (PDF)

     Download: Private Placement Memorandum (PDF)

DISCLOSURES
THIS DOES NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY THE SECURITIES, AND NO OFFER WILL BE MADE EXCEPT PURSUANT TO A PRIVATE PLACEMENT MEMORANDUM PROVIDED BY US.
THIS SUMMARY CONTAINS STATEMENTS WHICH CONSTITUTE “FORWARD-LOOKING STATEMENTS.” THESE STATEMENTS APPEAR IN A
NUMBER OF PLACES IN THIS SUMMARY. THESE FORWARD-LOOKING STATEMENTS INCLUDE, BUT ARE NOT LIMITED TO, STATEMENTS REGARDING PLANS, INTENTIONS, BELIEFS, EXPECTATIONS, PROJECTIONS, ASSUMPTIONS, DESCRIPTIONS OF POTENTIAL FUTURE EVENTS, AS WELL AS OTHER STATEMENTS THAT ARE NOT HISTORICAL FACTS. THE COMPANY AND ROYALTY EXCHANGE USE WORDS IN THIS MEMORANDUM SUCH AS “ANTICIPATES,” “BELIEVES,” “PLANS,” “EXPECTS,” “PROJECTS,” “FUTURE,” “INTENDS” AND SIMILAR EXPRESSIONS TO IDENTIFY FORWARD-LOOKING STATEMENTS. ALTHOUGH THE COMPANY AND ROYALTY EXCHANGE BELIEVE THAT THE EXPECTATIONS REFLECTED IN THESE FORWARD-LOOKING STATEMENTS ARE BASED ON REASONABLE ASSUMPTIONS, YOU ARE CAUTIONED THAT FORWARD-LOOKING STATEMENTS ARE NOT GUARANTEES OF FUTURE PERFORMANCE AND INVOLVE RISKS AND UNCERTAINTIES. ACTUAL RESULTS MAY DIFFER MATERIALLY FROM THOSE IN THE FORWARD-LOOKING STATEMENTS DUE TO VARIOUS FACTORS, INCLUDING THOSE DESCRIBED IN THE “RISK FACTORS” SECTION OF OUR PRIVATE PLACEMENT MEMORANDUM. FORWARD-LOOKING STATEMENTS SPEAK ONLY AS OF THE DATE OF THE DOCUMENT IN WHICH THEY ARE CONTAINED, AND THE COMPANY AND ROYALTY EXCHANGE DO NOT INTEND TO UPDATE OR REVISE ANY FORWARD- LOOKING STATEMENTS, WHETHER AS A RESULT OF NEW INFORMATION, FUTURE EVENTS OR OTHERWISE.