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IMPORTANT DISCLOSURE

Dated: December 2023

These important disclosures are deemed to be incorporated by reference in its
entirety into the Masterworks website at www.masterworks.com and any social
media communication, advertisement, email or other communication or disclosure
which contains an active hyperlink or URL to this page. The information
contained herein neither constitutes an offer for nor a solicitation of interest
in any specific securities offering.


SECTIONS

1. GENERAL INFORMATION

2. TESTING THE WATERS

3. INFLUENCER ENDORSEMENTS & TESTIMONIALS COMPENSATION DISCLOSURES

4. REGULATION A OFFERINGS & OFFERING CIRCULARS

5. OTHER EXEMPT OFFERINGS

6. INVESTMENT ADVICE

7. ART MARKET DATA & METRICS

8. MASTERWORKS PERFORMANCE METRICS

9. APPRAISALS & NET ASSET VALUE (NAV)

10. RISKS OF INVESTING

11. FORWARD-LOOKING STATEMENTS

12. MISCELLANEOUS


1. GENERAL INFORMATION

Masterworks, LLC (together with its affiliated entities, collectively
"Masterworks" or “we”) operates a website at www.masterworks.com (the "Site" or
“Masterworks Platform”). The information contained on the Site is generally
available to non-members (i.e. persons who have not established a user profile)
and has been prepared by Masterworks without reference to any particular user’s
investment requirements or financial situation. Potential investors are
encouraged to consult with professional tax, legal, and financial advisors
before making any investment into a Masterworks offering. All investments
involve risk, including the risk of the loss of all of your invested capital.
Please carefully consider the investment objectives, risks, and expenses related
to an investment prior to deciding to invest. Diversification and asset
allocation do not ensure profit or guarantee against loss. Investment decisions
should be based on an individual’s own goals, time horizon, and tolerance for
risk.

Investment overviews on the Site contain summaries of the purpose and the
principal business terms of potential investment opportunities. Such summaries
are intended for informational purposes only and do not purport to be complete,
and each is qualified in its entirety by reference to the more detailed
discussions contained in the respective Offering Circular filed with SEC or
other offering materials relating to such investment opportunity.

By using the Masterworks website, you accept the Masterworks.com Terms of Use
(which require that disputes be resolved through binding arbitration) and
Privacy Policy. Any person interested in investing in any Masterworks offering
should review our disclosures and the most recent publicly filed offering
statement relating to that offering or applicable private placement memorandum,
a copy of which will be available on the Site and, in the case of Regulation A
offerings, on the SEC’s EDGAR website.

The Site is maintained by Masterworks in its sole and absolute discretion and
Masterworks is solely responsible for the content on this website. No
broker-dealer member of FINRA is or has been involved in the development or
dissemination of this website. Nothing contained herein shall be deemed to be
binding against, or to create any obligations or commitment on the part of, any
potential investor, the offering sponsors, or their respective affiliates.

Neither the SEC nor any state securities commission or regulatory authority
approved, passed upon or endorsed the merits of any investment on the Site. Each
investor should always carefully consider investments in any security and be
comfortable with his/her understanding of the investment. Investors should not
construe any materials on the Site as tax, legal, financial or investment
advice.

All product names, logos, and brands are property of their respective owners.
Use of these names, logos, and brands is for identification purposes only, and
does not imply endorsement or affiliation.


2. TESTING THE WATERS

Masterworks may, from time to time, engage in “testing the waters” under
Regulation A of the Securities Act of 1933, as amended, for the offerings
currently filed with (but not yet qualified by) the SEC. This process allows
companies to determine whether there may be interest in an eventual offering of
their securities. Masterworks is not under any obligation to make an offering
under Regulation A. We may choose to make an offering to some, but not all, of
the people, who indicate an interest in investing, and that offering might not
be made under Regulation A. If we go ahead with an offering, we will only be
able to make sales after we have filed an offering statement with the SEC and
the SEC has “qualified” the offering statement. The information in the offering
statement will be more complete than any information provided on our website,
and could differ in important ways. You must consider fully the information
provided in the offering statement filed with (and qualified by) the SEC prior
to making any investment decision. No money or other consideration is being
solicited at this time for any pre-qualified offering, and if sent in response,
will not be accepted.

No offer to buy the securities for a pre-qualified offering can be accepted and
no part of the purchase price can be received by the issuer or anyone else until
the offering statement filed by the Masterworks issuer with the SEC has been
qualified by the SEC. Any such offer may be withdrawn or revoked, without
obligation or commitment of any kind, at any time before notice of acceptance is
given after the date of qualification. An indication of interest involves no
obligation or commitment of any kind by either party.


3. INFLUENCER ENDORSEMENTS & TESTIMONIALS COMPENSATION DISCLOSURES

Masterworks routinely engages social media influencers, spokespersons,
celebrities and other persons or entities with followers, members or an audience
(collectively referred to here as “Influencers”) to endorse or provide
testimonials about Masterworks and discuss art investing, the art market,
artwork as an alternative asset class, and or general information about
Masterworks and its art investing platform. Influencers generally do not
describe specific securities, issuer entities or pending or planned offerings.
All Influencers enter into written contracts with Masterworks obligating them to
make certain disclosures, including the fact that content is sponsored or paid
for by Masterworks. Unless separately disclosed in any testimonial or
endorsement content, to our knowledge, none of the Influencers are clients of
our registered investment adviser, own securities in Masterworks, or own
securities in any Masterworks’ sponsored investment entity referenced in such
content, or otherwise have any conflicts of interest stemming from their
relationship with Masterworks, other than receipt of cash compensation.
Masterworks does not pay Influencers non-cash compensation. The cash
compensation paid to Influencers varies depending on the size of the audience,
media type, number of content pieces sponsored and popularity and reach of the
Influencer. In 2022, Masterworks paid compensation to more than 1,000
Influencers, which varied from $500 to $300,000 per Influencer, with average
compensation of approximately $8,000. Influencers are compensated by Masterworks
through the following types of arrangements:

 * fixed fee per video, podcast or other other media content,
 * variable fee based on the actual audience size,
 * variable fee based on the number of people who sign up as users of our
   website (i.e. provide us with their name and email address) as a result of
   such content, or
 * hybrid arrangements that incorporate more than one of the above fee
   structures.

Variable compensation arrangements often include minimum and/or maximum fee
terms. The receipt of this compensation creates a conflict of interest because
the Influencers have a financial incentive to promote the Masterworks Platform.
Masterworks does not pay any Influencer compensation that is directly or
indirectly tied to any investment in securities.

Investors are strongly advised to do their own research regarding Masterworks
offerings and are cautioned not to place undue reliance on endorsements or
testimonials from Influencers.


4. REGULATION A OFFERINGS & OFFERING CIRCULARS

Any offering appearing on the Site that is made under Regulation A of the
Securities Act of 1933, as amended, will be made only by means of an offering
circular, which forms an integral part of an offering statement, that has been
qualified by the SEC. Any offering that is available for investment means the
SEC has qualified the offering statement for such offering, which only means
that the issuer of those shares may make sales of the securities described by
the offering statement. It does not mean that the SEC has approved, passed upon
the merits of, or passed upon the accuracy or completeness of the information in
the offering statement.

Offerings appearing on the Site may be in one of three stages:

 * Stage 1: The offering circular is in the process of being prepared, but not
   yet on file with the SEC.
 * Stage 2: The preliminary offering circular has been filed with the SEC, but
   has not yet been qualified by the SEC. Note, it is not unusual for a
   preliminary offering circular to be filed several times prior to completion
   of the SEC review process.
 * Stage 3: SEC review is complete, the offering circular is qualified and
   subscriptions and investment funds can be accepted.

In addition, it is possible that after an offering is commenced, we need to
update the offering circular to add or update material information, in which
case we may be required to suspend accepting subscriptions until such revised
offering circular has been reviewed by the SEC.

It is important to understand that the SEC does not pass upon the merits of or
give its approval to any securities offered or the terms of any offering, nor
does it pass upon the accuracy or completeness of any offering circular or other
solicitation materials.

If you are interested in investing in an offering, you should carefully review
the offering circular and other materials filed with the SEC before making an
investment decision. It is important to note that information contained in a
preliminary offering circular (i.e. Stage 2) may change and such changes could
be material, so even if you have reviewed a preliminary offering circular, it is
critical to review the most recent offering circular on file with the SEC prior
to subscribing for shares and tendering payment.

Although the Regulation A offering structure is similar in many respects to a
registered initial public offering of shares in a traditional public offering,
Regulation A is an exemption from the registration requirements of the
Securities Act and there are important differences between a Regulation A
offering and a traditional “registered” public offering, including, without
limitation, the following:

Limited Disclosure. Disclosure rules applicable to issuers under Regulation A
are more limited in scope than those applicable to issuers pursuing a
traditional public offering, so there may not be as much information included in
the offering circular for an offering referenced on the Site than there would be
in a prospectus. In addition, ongoing SEC reporting obligations for Regulation A
issuers are also more limited than requirements for typical companies.

Not Subject to 34’ Act Reporting; Proxy Rules, Insider Reporting. Traditional
publicly traded companies are subject to certain ongoing financial and material
event reporting requirements, proxy rules relating shareholder votes and
reporting of transactions by insiders. These requirements are not applicable to
issuers of securities pursuant to Regulation A, provided they comply with
certain requirements which Masterworks intends to comply with.

Less Restrictive Corporate Governance. As a non-listed company conducting an
exempt offering pursuant to Regulation A, Masterworks issuers are not subject to
a number of corporate governance requirements that would apply to companies
listed on national securities exchanges, including the requirement to have a
board of directors with a majority of “independent” directors, independent
committees and internal controls audits. Accordingly, you may not have the same
protections afforded to shareholders of companies that are subject to all of the
corporate governance requirements of a company listed on a national stock
exchange.

Lack of Liquidity. Traditional initial public offering issuers list their shares
on a national securities exchange that makes it relatively easy for market
participants to trade the securities. The shares offered by Masterworks will not
be listed on a national securities exchange and may be illiquid. Accordingly,
investors must be prepared to hold their investment for an indefinite period.

Equity Stock Transfer, LLC is the sole transfer agent and registrar of all of
the Class A ordinary shares offered in any Masterworks Regulation A offering.
For further information regarding the transfer agent, you should refer to the
offering circular and other materials of the applicable Masterworks issuer filed
with the SEC.

Regulation A Offering Circulars. Active hyperlinks to offering circulars for
Regulation A offerings, other than closed offerings, are set forth below. To the
extent an issuer has satisfied a requirement to include financial statements in
an offering circular by incorporating such financial statements by reference to
another SEC filing, we have also provided active hyperlinks to the SEC filing
that contains such financial statements below.

YOU MUST CAREFULLY REVIEW THE RELEVANT MASTERWORKS OFFERING CIRCULAR BEFORE
DECIDING TO INVEST.

Masterworks Vault 1, LLC

 * Audited Financial Statements
 * Unaudited Financial Statements

Masterworks Vault 2, LLC

 * Audited Financial Statements
 * Unaudited Financial Statements

Masterworks Vault 3, LLC

 * Audited Financial Statements
 * Unaudited Financial Statements

Masterworks Vault 4, LLC

 * Audited Financial Statements
 * Unaudited Financial Statements (Not applicable)

Masterworks Vault 5, LLC

 * Audited Financial Statements (Not Applicable)
 * Unaudited Financial Statements (Not Applicable)

Masterworks 254, LLC (Condo)

Masterworks 274, LLC (Condo)

Masterworks 278, LLC (Bradford)

Masterworks 282, LLC (Basquiat)

Masterworks 284, LLC (Frankenthaler)

Masterworks 286, LLC (Bradford)

Masterworks 289, LLC (Soulages)


5. OTHER EXEMPT OFFERINGS

Masterworks may also conduct private placements pursuant to Rule 506(c) of
Regulation D of the Securities Act to accredited investors who are willing to
make large investments or to non-residents of the United States pursuant to
Regulation S. Any offers associated with these exempt offerings will be made
pursuant to a private placement memorandum (a “Memorandum”). These offerings may
differ from our Regulation A offerings in that they may involve pooled
investment vehicles that offer an investment in a portfolio of multiple
artworks, which may include fractional investment in each artwork (i.e. the
investment entity owns shares representing a fractional investment in the
artwork) and or whole artwork (i.e. the investment entity owns the entire
artwork).

These exempt offerings pursuant to Regulation D and Regulation S differ from
traditional registered offerings in many of the same ways that Regulation A
offerings differ from traditional registered offerings as described herein, plus
they differ differ from Regulation A transactions in a number of key respects,
including, without limitation:

Accredited or Non-U.S. Investors Only. Regulation A offerings are generally open
to everyone, subject to maximum investment limits imposed under the Securities
Act and investment minimums imposed by Masterworks. By contrast, SEC rules limit
participation in Regulation D offerings to “accredited investors” (as defined in
Rule 501 of the Securities Act), so people who are not “accredited investors”
cannot participate. Likewise, Regulation S offerings are limited to persons who
are non-residents of the United States, so United States residents cannot
participate.

Limited Rights and Remedies. In contrast to Regulation A, there are no specific
substantive disclosure requirements pursuant to Regulation D or Regulation S, so
the Memorandum for these offerings may be more limited in scope than an Offering
Circular for a Regulation A offering. In addition, whereas investors in a
Regulation A offering may pursue remedies under Section 12 of the Securities
Act, which imposes strict liability on an issuer for misstatements and omissions
in an offering circular regardless of the issuer’s intent, an investor in a
Regulation D offering or Regulation S offering must pursue remedies pursuant to
Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder
which requires a showing of deliberate and intentional fraudulent conduct on the
part of the issuer or offering participant - a much higher burden for an
aggrieved investor.

No SEC Reporting. Issuers in Regulation D offerings and Regulation S offerings
do not have any initial or ongoing SEC reporting obligations (other than the
filing of a Form D for Regulation D offerings), so investors in these other
exempt offerings may not have access to financial and other important
information.

Less Liquidity. Securities issued pursuant to Tier II of Regulation A are
illiquid, but they are freely transferable under U.S. Federal securities laws.
Securities issued in Regulation D offerings and Regulation S offerings are
referred to as “restricted” securities because they cannot be resold or
transferred unless the sale or transfer is registered with the SEC or otherwise
exempt from registration. Securities acquired in these types of exempt offerings
will bear a restrictive legend indicating that such securities cannot be sold or
transferred absent registration or an applicable exemption.


6. INVESTMENT ADVICE

None of the information on our Site should be construed as investment advice.
Investment advice is provided by representatives of Masterworks Advisers, LLC
(“MWA”). MWA is registered with the Securities and Exchange Commission as an
investment adviser under the Investment Advisers Act of 1940. Advisory services
are only provided to investors who become clients of MWA (“Clients”) pursuant to
a written Investment Advisory Agreement, which investors are required to read
and sign, along with Part 2 of MWA’s Form ADV, and carefully consider in
determining whether such agreement is suitable for their individual facts and
circumstances. Registration with the SEC does not imply a certain level of skill
or training. All MWA representatives are paid, directly or indirectly by
Masterworks and investment advice is provided without cost or obligation of any
kind.

The information contained on the Site has been prepared by Masterworks without
reference to any particular user’s investment requirements or financial
situation. Potential investors are encouraged to consult with professional tax,
legal, and financial advisors before making any investment into a Masterworks
offering.


7. ART MARKET DATA & METRICS

Unless otherwise stated, all art market data and metrics appearing in
Masterworks materials was compiled from public auction records and other third
party sources and does include private sales, which account for a significant
percentage of all sales. Importantly, since all art market data is sourced from
public auction records, when we use terms like “contemporary art” or “art
market”, unless otherwise indicated, we are referring only to art that has a
liquid secondary market and is sold at auction by major auction houses, which
includes work by well known artists who have achieved a level of commercial
success and such data excludes works by local or regional artists that do not
have a well-established collector base or liquid secondary market. We believe
this data can be helpful in measuring and analyzing historical trends. We
present these metrics on the Site and in SEC materials when we believe the
sample size is meaningful for a particular metric, so we may not present all
metrics for every Masterworks offering. These art market metrics, including
historical appreciation rates, may be presented in graphs, charts, diagrams or
as stand-alone statistics and may be presented as a trendline relating to
certain segments of the overall art market, a particular artist or a particular
set of paintings selected for their similarity to a specific painting offered
through the Site. Art sales price data and metrics are used for comparative
modeling purposes only. Each painting is unique and historical price trends of a
group of selected artwork is not a direct proxy for historical price performance
of any specific painting or any investment in securities referenced on the Site.

Any transaction conducted in a foreign currency has been converted to U.S.
dollars at the prevailing exchange rate as of the applicable transaction date,
except with respect to “repeat sales”, in which case the conversion of a foreign
currency to U.S. dollars occurs at the time of the first sale of the repeat sale
pair. We endeavor to include all relevant works and transactions, but no
definitive object-oriented database with all auction sales is known to
Masterworks, and therefore, despite our best efforts the data may be incomplete
or inaccurate and we may exclude sale records that do not contain images. Unless
stated otherwise in the relevant materials, the data only include artworks
reflective of the artist’s main medium, as defined by Masterworks and will
exclude works on paper, prints, editions, multiples or any non-unique works of
art by the relevant artist. In addition, the historical data may include auction
transactions in which affiliates of Masterworks acted as buyer and or seller.

Masterworks strongly cautions investors not to place undue reliance on
historical data presented and we note the following:

ART PRICE DATA AND TRENDS IS NOT A PROXY FOR INVESTMENT PERFORMANCE. RETURNS
FROM INVESTMENTS IN MASTERWORKS ISSUERS WILL BE REDUCED BY FEES AND EXPENSES
DESCRIBED IN THE SEC OFFERING MATERIALS THAT ARE NOT REFLECTED IN THE PRICE
PERFORMANCE DATA AND METRICS PRESENTED.

INVESTORS ARE CAUTIONED THAT NO SELECTION OF SIMILAR ARTWORK IS DIRECTLY
COMPARABLE TO THE PRICE PERFORMANCE OF ANY SPECIFIC ARTWORK OR INVESTMENT SINCE
EACH ARTWORK IS UNIQUE AND HAS ITS OWN UNIQUE RESULTS AND VOLATILITY, AND SUCH
HISTORICAL DATA FOR A SELECTED GROUP OF ARTWORK, IF SHOWN, SHOULD NOT BE RELIED
UPON AS AN ACCURATE COMPARISON. AVERAGE RATES OF APPRECIATION REFLECTED IN A
TRENDLINE FOR SIMILAR WORKS OF ART MAY NOT BE REPRESENTATIVE OF THE PERFORMANCE
OF ANY SPECIFIC ARTWORK.

THE FUTURE IS NEVER THE SAME AS THE PAST. PAST APPRECIATION RATES MAY NOT BE
INDICATIVE OF FUTURE APPRECIATION RATES AND ANY EXPECTED RETURNS OR PAST RETURNS
MAY REFLECT THE PRICE TRENDS OF ARTWORK FOR A FINITE TIME, OR DURING A PERIOD OF
EXTREME MARKET ACTIVITY. ALL INVESTMENTS INVOLVE RISK AND MAY RESULT IN PARTIAL
OR TOTAL LOSS.

Compiling meaningful price appreciation data for artwork is inherently difficult
and prone to a number of significant limitations and subjectivity that
significantly limits the utility of such data in evaluating future appreciation
rates. Difficulties arise due to the unique nature of each painting, coupled
with the fact that paintings tend to sit in collections for many years, if not
several decades, which most often makes it impossible to find sufficient recent
actual sales data to establish an appreciation trend line. To try to estimate
how much a specific painting has appreciated over time often requires
extrapolation to sales data from a set of similar works by the same artist. The
selection criteria for what constitutes a “similar” work are highly subjective
and even experts would likely disagree on exactly which particular works or
characteristics, such as size, colors, subject matter, condition, etc. should be
included or excluded in any given comparative data set. The level of
subjectivity involved differs depending on the uniqueness of the underlying
artwork. Furthermore, private sales data, which includes a majority of sales, is
often unavailable or inaccurate, so the data set is typically comprised of only
public auction sales data. The availability of public auction data varies by
artist. As a general matter a larger data set is more useful than a smaller data
set. There can be no assurance that an investment mix or any actual price
performance shown on the Site will lead to the expected results shown or perform
in any predictable manner. It should not be assumed that investors will
experience returns in the future, if any, comparable to those shown or that any
or all investors on the Site experienced such returns.

Comparisons to Other Asset Classes

Masterworks often uses art market price data to compare art pricing trends to
other asset classes, such as stock, bonds, real estate, gold and other assets.
While Masterworks believes these comparisons can be useful to help potential
investors discern long term trends in these asset classes, there are significant
limitations to the utility of such comparative data, particularly over shorter
time periods, and potential investors are cautioned not to place undue reliance
on such data. There are significant differences between art and these other
asset classes. For example, many asset categories are far more liquid than
artwork. Whereas exchange traded stocks, commodities and precious metals are
priced continuously in real time, art prices upon which data is available (i.e.
public auctions) are updated only on limited occasions during select months of
the year when public auctions are held. As a result, these asset categories may
appear to be more volatile than art and will react more quickly to events and
market forces than art prices. Several leading asset categories are
commoditized, so demand is concentrated on the asset category as a whole as
opposed to art, which is fragmented into separate artist markets. In addition,
most other asset categories have been securitized or otherwise packaged in
various types of financial products and instruments such that large pools of
capital can efficiently flow in and out of them with relatively low friction in
terms of time, effort and cost. By contrast, despite Masterworks ongoing efforts
to make art investable, on the whole, artwork transactions remain far more
bespoke and less efficient in terms of time, effort and cost than most other
asset categories.

Art Market Data Metrics

Metrics that Masterworks presents may include some or all of the following:

Selected Similar Sales Appreciation. Selected similar sales provide an estimate
of the historical appreciation rate of the specific artwork by looking at a set
of similar works by the artist that have sold at public auction. The set of
similar works selected will include all works by the same artist believed to
have features and characteristics that are similar to the subject artwork, which
may include size, medium, color, composition elements, period of creation and
other features. The applicable time period for which we calculate Selected
Similar Sale Appreciation is from the earliest date that an artwork by the
artist was sold at public auction until the most recent date prior to the
qualification of an applicable offering that the Masterworks public sale
database has been updated. Although the artworks selected for inclusion in the
set of similar works have similar characteristics to the subject artwork, each
individual artwork is unique in terms of artistic content, coloring, condition,
provenance and other factors. We, therefore, cannot make any determination or
representation that our estimate of the historical appreciation rate of an
artwork is correct or predictive of future value.

Market-Risk Adjusted Appreciation, or “Sharpe Ratio”. The Market-Risk Adjusted
Appreciation, also referred to as the “Sharpe Ratio,” indicates how well the
artist’s market has performed historically in comparison to the rate of return
on a risk-free investment, such as U.S. government treasury bonds or bills, by
measuring price appreciation relative to the volatility of that price
appreciation over time. A relatively higher Sharpe Ratio reflects higher
appreciation relative to volatility and generally signals a better risk adjusted
return, and, conversely, a relatively lower Sharpe Ratio generally means there
is more volatility relative to price appreciation, although historical
volatility is not necessarily a proxy for investment risk. The Sharpe Ratio
reflects (x) the average annualized artist market appreciation (depreciation) of
all artworks by an artist that have sold at least twice at public auction
(referred to as “repeat sales”), minus the risk-free rate of return. The
risk-free rate of return is measured by the average annual risk-free rate at
year end over the applicable time period, divided by (y) the volatility of the
returns in an artist’s market, as measured by the standard deviation of those
returns. The applicable time period for which we calculate the Sharpe Ratio
begins on the later of (a) the earliest purchase price date for the artist’s
first repeat sale or (b) December 31, 1989, the year end of the earliest year
when other financial indices were available, and ends on the last sale date that
the artist had a repeat sale prior to the qualification of an applicable
offering that the Masterworks public sale database has been updated.

Record Price Appreciation. Record Price Appreciation reflects the frequency at
which a new record hammer price at auction is achieved by the artist which can
be indicative of the artist’s market momentum and growth rate. The applicable
time period for which we calculate Record Price Appreciation is from the
earliest date that an artwork by the artist was sold at public auction until the
most recent date for which a record price exists prior to the qualification of
an applicable offering that the Masterworks public sale database has been
updated.

Median Repeat Sale Pair Appreciation. Median Repeat Sale Pair Appreciation
reflects the median annualized price appreciation rate of all artworks by an
artist that have sold at least twice at public auction, known as “repeat sales”,
which indicates the progression of prices in a particular artist’s market over
time. Analysis of repeat sales can be useful because repeat sale data reflects
price changes for the same works, which reduces the selection bias inherent in
looking at a select set of similar works.


8. MASTERWORKS PERFORMANCE METRICS

When Masterworks presents the net return of an investment in a sold artwork,
“net return” or “IRR” refers to the annualized internal rate of return net of
all fees and expenses, calculated from the offering closing date to the date the
sale is consummated. IRR may not be indicative of Masterworks paintings not yet
sold and past performance is not indicative of future results. For additional
information regarding the calculation of IRR for a particular investment in an
artwork that has been sold, a reconciliation will be filed as an exhibit to Form
1-U and will be available on the SEC’s website at www.sec.gov.


9. APPRAISALS & NET ASSET VALUE (NAV)

General

Masterworks internally appraises artworks that are held by entities administered
by Masterworks Administrative Services on an ongoing basis, and obtains an
independent review of appraisals by a third-party appraiser on an annual basis.
The objective of an appraisal is to determine the Fair Market Value (“FMV”) of
the subject artwork, which is equal to the price property would sell for on the
open market between a willing buyer and a willing seller, with neither being
required to act, and both having reasonable knowledge of the relevant facts,
consistent with the standards set forth in IRS Publication 561. FMV includes
expected buyer’s premium and estimated transaction commissions.

FMV is measured principally by the Sales Comparison Approach, a relative value
comparison basis on sales transactions involving similar objects (i.e.
comparable sales). Appraisals are prepared in accordance with the 2020-2021
Uniform Standards of Professional Appraisal Practice (“USPAP”) developed by the
Appraisal Standards Board of the Appraisal Foundation, although it is noted that
there are potential conflicts of interest given that some or all individual
members of the appraisal committee are employees of Masterworks and Masterworks
retains an ownership interest in the subject artworks as well as ownership of
the Masterworks Platform.

The secondary trading price of any securities which may represent an investment
in the subject artwork are not considered in conducting the appraisal.

Masterworks appraisals are jointly conducted by an appraisal committee
consisting of three members.

Timing

Review of the Fair Value of all artwork for which title is held in any
Masterworks investment entity are performed, at a minimum, on a quarterly basis,
except as described below. If this review reveals an event, including a
comparable sale, which materially alters the current FMV of the subject artwork,
an appraisal report will be issued promptly following the close of a fiscal
quarter and reflect FMV as of the last day of the calendar quarter then ended,
excluding artworks which were the subject of a recent offering. Select artworks
may be appraised or previously issued appraisals may be revised more frequently
than quarterly at the discretion of the appraisal committee.

Defining and Identifying Comparable Artwork

The Appraisal Committee will determine the parameters included in the comparable
set of artwork to be evaluated. Comparable objects are selected based on similar
characteristics to the subject work, which may include, but are not limited to:
artist, size, date of creation, medium, series, imagery, execution, style or
technique, colors, condition, provenance and/or exhibition history, and prior
sale history (if any). Comparable characteristics for each artwork are
determined on a case-by-case basis based on the appraiser’s knowledge of the
respective artist’s market.

Important Limitations on Usefulness of Appraisals

The FMVs determined by Masterworks’ appraisals are only valid as of the
effective date of such appraisals and do not reflect any sales of objects
conducted after the effective date. The art market (and individual artist
markets) typically do not move in a linear fashion and a single unexpected
auction result (positive or negative) can have a significant impact on values.

Artwork very commonly sells for amounts considerably above or below its
appraised or estimated value or fails to sell altogether. The future realizable
value of a fine artwork may differ widely from its estimated or appraised value
for a variety of reasons, many of which are unpredictable and impossible to
discern. Valuation is heavily reliant on an analysis of sales history of similar
artwork. Experts often differ on which historical sales are comparable and the
degree of comparability.

Potential Conflicts of Interest in Performing Appraisals

The appraisal committee is composed of employees of Masterworks, which receives
compensation for the administration and profitable sale of the artwork.
Masterworks business in general is influenced by the FMV of artwork it manages.
The compensation of members of the appraisal committee is not directly
contingent upon the performance of any appraisal, including reporting of a
predetermined value or direction in value that favors the cause of Masterworks,
the appraised fair market value, the attainment of a stipulated result, or the
occurrence of a subsequent event directly related to the intended use of any
appraisal. Although Masterworks may have conflicts of interest, it has taken
steps it deems reasonable to ensure that the appraisal committee can act
independently of Masterworks and free from bias. Masterworks does not earn fees
tied directly to appraised values.

Masterworks is active in buying, and selling in the art market. If there is a
sale of a work that Masterworks has purchased at public auction that qualifies
as comparable to the target object, the comparable sale may be included in the
comparable data set at the discretion of the lead appraiser

You are cautioned against placing undue reliance on any given appraised value
and there is no assurance that an independent appraisal would produce a
different appraised value.

Net Asset Value

Est. NAV reflects our effort to provide investors with an indication of how
their investments and the Masterworks portfolio as a whole are performing. These
metrics are determined based on estimates and assumptions that management
believes are reasonable, but there can be no assurance that our estimates and
assumptions will prove to be correct or will approximate actual performance,
which will depend on future events and circumstances, many of which are beyond
our ability to predict or control. Past performance not only does not guarantee
future results, but may not have any meaningful predictive value as to future
results. and estimated changes in net asset values based on appraisals may not
correspond to actual realizable values. All securities involve risk and may
result in partial or total loss.

"NAV Per Share" reflects our estimate of the net asset value of a Class A share
at a stated point in time, after giving effect to all expenses, all dilutive
issuances in respect of management fees and deduction of all profits interests
held by Masterworks. NAV Per Share amounts are updated quarterly, typically
within approximately fifteen (15) days following the end of each fiscal quarter.
NAV Per Share is calculated by determining the fair market value of the artwork
through an appraisal and deducting the profit share amount, if any, allocable to
the Class B shareholders and then dividing the remaining amount by the number of
fully diluted Class A shares outstanding (including all Class A shares issued or
issuable as of such date in respect of management fees).

Transactions occurring on the Masterworks’ secondary market have no impact on
the determination of NAV Per Share. Masterworks does not earn fees tied to NAV
Per Share.


10. RISK OF INVESTING

Investing involves a number of significant risks and uncertainties. Please also
review the "Risk Factors" section of our latest SEC filings prior to investing.
In addition, you should consult your own counsel, accountant and other advisors
as to legal, tax, business, financial, and related aspects of an investment in a
Masterworks issuer. Past performance is no guarantee of future results and past
historical appreciation rates of artwork may not be indicative of future
appreciation rates. An investor can lose money. Diversification and asset
allocation do not ensure a profit or guarantee against loss. Investment
decisions should be based on an individual’s own goals, time horizon, and
tolerance for risk.

Set forth below is a summary of certain risks that should be considered, but
this summary is not a substitute for the more extensive and specific language
included in the offering circular or Memorandum for any particular Masterworks
issuer.

Masterworks Issuers are totally reliant on Masterworks. Masterworks issuers do
not expect to generate revenue, so issuers are totally reliant on Masterworks to
administer their operations and cover ongoing operating expenses. Investors will
only recognize a return on their investment if the painting is sold or they are
able to sell their shares.

Each Issuer is Undiversified. Investing in any given Masterworks issuer is risky
since 100% of such investment is concentrated in a single artwork and, with
respect to issuers offering investment in a collection of artwork, such
collection may provide limited exposure to a small subset of artists and
artwork.

Your Ability to Trade Shares is Uncertain. There is no active public market for
Masterworks issuer shares and an active trading market may not ever develop or,
even if developed, may not be available to all shareholders, may not be
sustained or may cease to exist. Although we facilitate secondary purchases and
sales of Class A shares of certain Masterworks issuers on an alternative trading
system operating by Templum Markets LLC (the “Templum ATS”), certain investors
are not eligible to participate on the Templum ATS, including certain non-U.S.
citizens, and it may not provide an effective means to sell your shares or
receive a price for your shares that is reflective of the fair value of the
Class A shares or the Artwork. You should consider the resale market for
Masterworks shares to be severely limited, as you may be unable to resell your
shares without significant expense, or at all.

Artwork may be Sold at a Loss. A painting can decline in value and investors in
Masterworks shares may lose all or a significant portion of their investment.
Even if the artwork appreciates in value, the rate of appreciation may be
insufficient to cover costs and expenses.

Illiquidity. Masterworks issuers intend to hold paintings for many years and the
creation of a trading market for the shares that will generate sufficient volume
to facilitate price discovery is uncertain. Art is a highly illiquid asset and
we cannot guarantee that there will be a buyer at any reasonable price or within
any given time frame. Investors shoul be prepared to hold their investment for
an indefinite period of time, as there can be no assurance that the shares or
the artwork can be sold.

Costs Will Diminish Returns. Fixed expense allocations, administrative services
fees paid to Masterworks and Masterworks profit sharing, along with third party
costs to sell the painting, if any, will reduce overall returns on invested
capital.

Investing in Art is subject to Numerous Risks. These risks include, without
limitation, physical damage, market risks, economic risks and fraud.

Trends. Temporary consumer popularity or trends among collectors may lead to
short-term or temporary price increases, followed by decreases in value. Trends
are difficult to predict and may adversely impact our ability to sell an
artwork.

Claims. Buying and selling artwork can involve potential claims regarding title,
provenance and or authenticity of the artwork. Costs associated with litigation
and or settlement are the responsibility of each Masterworks issuer.

Insurance Coverage May be Insufficient. Insurance coverage may expressly exclude
damage caused by war, certain title claims, losses caused by chemical or
biological contamination and certain other potential loss scenarios. In
addition, coverage limits may be below fair value.

Masterworks has Potential Conflicts of Interest. Masterworks earns fees and
incurs costs for administering Masterworks issuers. Masterworks performs
internal valuations of artwork held by Masterworks issuers as opposed to
obtaining valuations from disinterested third parties. Masterworks interests and
the interests of its Board of Managers and officers may not always be aligned
with your interests.

Liquidation Timing is Uncertain. There can be no assurance as to the timing of a
liquidating distribution or that a Masterworks issuer will pay a liquidating
distribution at all.


11. FORWARD-LOOKING STATEMENTS

The www.masterworks.com website contains certain forward-looking statements that
are subject to various risks and uncertainties. Forward-looking statements are
generally identifiable by use of forward-looking terminology such as “may,”
“will,” “should,” “potential,” “intend,” “expect,” “outlook,” “seek,”
“anticipate,” “estimate,” “approximately,” “believe,” “could,” “project,”
“predict,” or other similar words or expressions. Forward-looking statements are
based on certain assumptions, discuss future expectations, describe future plans
and strategies, or state other forward-looking information. Our ability to
predict future events, actions, plans or strategies is inherently uncertain and
actual outcomes could differ materially from those set forth or anticipated in
our forward-looking statements. You are cautioned not to place undue reliance on
any of these forward-looking statements.


12. MISCELLANEOUS


MASTERWORKS WAITLIST

Visitors to the Masterworks website who are interested in learning more may be
placed on a waitlist. Visitors are typically placed on the waitlist because
MWA’s investment advisory representatives do not have availability to meet with
them or we’ve determined that such visitors are either unlikely to invest or
meet our minimum investment criteria based on information we collect. We
prioritize visitors who visit the website based on lead source, our assessment
of their level of interest in investing and ability to meet our minimum
investment criteria. Individuals on the waitlist will receive an email
confirming when/if they have been removed from the waitlist and they will be
able to invest on a self-serve basis without having a call with an investment
advisory representative. Depending on facts and circumstances, some individuals
could be on the waitlist indefinitely.


OFFERING PROGRESS BARS

Masterworks communications may reference an offering’s progress, typically
expressed as a percentage accompanied by graphic representation commonly
referred to as a “progress bar” or “progress meter”. The percentage reflects the
percentage of the total offering for which investors have initiated a
subscription on the website’s buyflow. This includes subscriptions that have
closed for which shares have been issued, subscriptions that have been funded,
but are not yet closed, subscriptions that been signed (i.e. reserved), but not
yet funded and subscriptions that have been initiated whereby a person has
entered the number of shares and amount they wish to purchase, but has not yet
completed the subscription. Since some of these potential investors will
ultimately not complete the purchase, the progress percentage always reflects
the higher end of the range of subscriptions received at any given point in
time.


USE OF FICTIONAL EXAMPLES FOR ILLUSTRATIVE PURPOSES ONLY

The Site may contain fictional charts, diagrams, drawings and illustrations to
provide a visual representation of an idea, concept or process. These fictional
illustrations can be easily identified as such as they will typically indicate
that they are presented for illustrative purposes only and, in contrast to
actual charts, diagrams, graphs and non-fictional data, will not include a
reference to any specific source of data. Any numbers, percentages or statements
set forth in connection with fictional illustrations are also provided solely
for illustrative purposes only and or as an example of one possible outcome.
Fictional illustrations and data provided in or alongside fictional
illustrations should not be relied upon or given any meaning.


TAX

Masterworks issuers are limited liability companies that elect to be taxed as
partnerships. Each person that holds Masterworks issuer shares will be issued a
Form K-1 following the end of each tax year. We do not anticipate that any
Masterworks issuer will generate taxable income during any tax year, other than
the tax year in which the artwork is sold and only if the artwork is sold at a
profit. Title to the artwork owned by the Masterworks issuers will be vested in
a wholly owned Cayman Islands subsidiary of the issuer that is taxed as a
corporation. We believe this structure will result in zero entity level
taxation. The tax consequences to you as an investor will vary depending upon
your specific circumstances. You are advised to consult with your tax advisor
prior to making an investment.


NOTICE TO FOREIGN INVESTORS

The offering materials prepared by Masterworks are directed solely to persons
located within the United States. If the recipient of the materials lives
outside the United States, it is their responsibility to fully observe the laws
of any relevant territory or jurisdiction outside the United States in
connection with any purchase of membership interests, including obtaining
required governmental or other consents or observing any other required legal or
other formalities. Unless otherwise indicated in SEC offering materials,
Masterworks has not not qualified the offering of the shares in any jurisdiction
outside the United States.

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None of the information on our Site should be construed as investment advice.

Investment advice is provided by representatives of Masterworks Advisers, LLC
(“MWA”). MWA is registered with the Securities and Exchange Commission as an
investment adviser under the Investment Advisers Act of 1940. Financial advisory
services are only provided to investors who become clients of MWA (“Clients”)
pursuant to a written Investment Advisory Agreement, which investors are
required to read and sign, along with MWA’s Form ADV Part 2A, and carefully
consider in determining whether such agreement is suitable for their individual
facts and circumstances. Registration with the SEC does not imply a certain
level of skill or training. All MWA representatives are paid directly, or
indirectly, by Masterworks and investment advice is provided without cost or
obligation of any kind.

The information contained on the Site has been prepared by Masterworks without
reference to any particular user’s investment requirements or financial
situation. Potential investors are encouraged to consult with professional tax,
legal, and financial advisors before making any investment into a Masterworks
offering.

YOU MUST CAREFULLY REVIEW THE RELEVANT MASTERWORKS OFFERING CIRCULAR BEFORE
DECIDING TO INVEST, A COPY OF WHICH WILL BE AVAILABLE ON THIS WEBSITE HERE, OR
AS AVAILABLE ON THE SEC’S EDGAR WEBSITE.

This website contains summary information relating to investment opportunities
that are intended for informational purposes only and do not purport to be
complete, and each is qualified in its entirety by reference to the more
detailed discussions contained in the respective Offering Circular filed with
SEC or other offering materials relating to such investment opportunity. None of
the information on this website should be construed as a recommendation or as
investment, financial, tax or legal advice.

By using this website, you agree to the Masterworks.com Terms of Use (which
require that disputes be resolved through binding arbitration) and Privacy
Policy. For more information about our website and Masterworks offerings, you
should review our Important Disclosures.

Masterworks is not registered, licensed, or supervised as a broker dealer by the
SEC or the Financial Industry Regulatory Authority (FINRA).

Masterworks is not a bank, it is a financial technology company. We have
partnered with Synapse Financial Technologies Inc and their partner bank to
provide banking services through Evolve Bank & Trust, Member FDIC.

For any proposed offering pursuant to an offering statement that has not yet
been qualified by the SEC, no money or other consideration is being solicited,
and if sent in response, will not be accepted. No offer to buy the securities
can be accepted and no part of the purchase price can be received until the
offering statement for such offering has been qualified by the SEC any such
offer may be withdrawn or revoked, without obligation or commitment of any kind,
at any time before notice of acceptance given after the date of qualification.
An indication of interest involves no obligation or commitment of any kind.


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