4 - Distribution Requirements

Decision Information

Decision Content

Form 1 - Start-up Crowdfunding Offering Document GENERAL INSTRUCTIONS: (1) This offering document and all amendments must be typed, printed, signed, and filed with the securities regulatory authority or regulator of each of the participating jurisdictions where the issuer has made a start-up crowdfunding distribution, as well as with the securities regulatory authority or regulator in the issuers head office jurisdiction at the address(es) provided on the last page of this form no later than the 30th day after the closing of the distribution. Issuers must also file a report of exempt distribution no later than the 30th day after the closing of the distribution. (2) This offering document must be completed and certified by an authorized individual on behalf of the issuer. (3) Draft this offering document so that it is easy to read and understand. Be concise and use clear, plain language. Avoid technical terms. (4) Conform as closely as possible to the format set out in this form. Address the items in the order set out below. No variation of headings, numbering or information set out in the form is allowed and all are to be displayed as shown. (5) For information on how to complete this form, please refer to the Start-up Crowdfunding Guide for Businesses available on the website of the securities regulatory authority or regulator of the participating jurisdictions. (6) This offering document is to be provided to your funding portal which has to make it available on its website. If the information contained in this offering document no longer applies or is no longer true, you must immediately amend the document and send the new version to the funding portal. Item 1: RISKS OF INVESTING 1.1 Include the following statement, in bold type: No securities regulatory authority or regulator has assessed reviewed or approved the merits of these securities or reviewed this offering document. Any representation to the contrary is an offence. This is a risky investment.” Item 2: THE ISSUER 2.1 Provide the following information for the issuer: (a) Full legal name as it appears in the issuers organizing documents, 8
(b) Head office address, (c) Telephone, (d) Fax, and (e) Website URL. 2.2 Provide the following information for a contact person of the issuer who is able to answer questions from purchasers and security regulatory authority or regulator: (a) Full legal name (first name, middle name and last name), (b) Position held with the issuer, (c) Business address, (d) Business telephone, (e) Fax, and (f) Business e-mail. Item 3: BUSINESS OVERVIEW 3.1 Briefly explain, in a few lines, the issuers business and why the issuer is raising funds. Include the following statement, in bold type: A more detailed description of the issuers business is provided below.” Item 4: MANAGEMENT 4.1 Provide the information in the following table for each promoter, director, officer and control person of the issuer: Full legal Principal Expertise, name occupation education, and municipality for the last experience of five years that is relevant residence to the issuers and business position at issuer 9 9 Number Date Percentage of and type of securities the securities were issuers of the acquired securities issuer and price held as of the owned paid for the date of this securities offering document
10 4.2 State whether each person listed in item 4.1 or the issuer, as the case may be: (a) has ever, pled guilty to or been found guilty of: (i) a summary conviction or indictable offence under the Criminal Code (R.S.C., 1985, c. C-46) of Canada, (ii) a quasi-criminal offence in any jurisdiction of Canada or a foreign jurisdiction, (iii) a misdemeanour or felony under the criminal legislation of the United States of America, or any state or territory therein, or (iv) an offence under the criminal legislation of any other foreign jurisdiction, (b) is or has been the subject of an order (cease trade or otherwise), judgment, decree, sanction, or administrative penalty imposed by a government agency, administrative agency, self-regulatory organization, civil court, or administrative court of Canada or a foreign jurisdiction in the last ten years related to his or her involvement in any type of business, securities, insurance or banking activity, (c) is or has been the subject of a bankruptcy or insolvency proceeding, (d) is a director or executive officer of an issuer that is or has been subject to a proceeding described in paragraphs (a), (b) or (c) above. Item 5: START-UP CROWDFUNDING DISTRIBUTION 5.1 Provide the name of the funding portal the issuer is using to conduct its start-up crowdfunding distribution. 5.2 List the name of all the participating jurisdictions (Canadian province or territory) where the issuer intends to raise funds and make this offering document available. 5.3 Provide the following information with respect to the start-up crowdfunding distribution: (a) the date before which the issuer must have raised the minimum offering amount for the closing of the distribution (no later than 90 days after the date this offering document is made available on the funding portal), and (b) the date(s) and description of any amendment(s) made to this offering document, if any. 5.4 Indicate the type of eligible securities offered. 5.5 The eligible securities offered provide the following rights (choose all that apply): Voting rights, Dividends or interests (describe any right to receive dividends or interest), Rights on dissolution, 10
11 Conversion rights (describe what each security is convertible into), Other (describe the rights). 5.6 Provide a brief summary of any other material restrictions or conditions that attach to the eligible securities being offered, such as tag-along, drag along or pre-emptive rights. 5.7 In a table, provide the following information: Total amount ($) Total number of eligible securities issuable Minimum offering amount Maximum offering amount Price per eligible security 5.8 Indicate the minimum investment amount per purchaser, if any. Item 6: ISSUERS BUSINESS 6.1 Describe the issuers business. Provide details about the issuers industry and operations. 6.2 Describe the legal structure of the issuer and indicate the jurisdiction where the issuer is incorporated or organized. 6.3 Indicate where the issuers articles of incorporation, limited partnership agreement, shareholder agreement or similar document are available to purchasers. 6.4 Indicate which statement(s) best describe the issuers operations (select all that apply): Has never conducted operations, Is in the development stage, Is currently conducting operations, Has shown profit in the last financial year. 6.5 Indicate whether the issuer has financial statements available. If yes, include the following statement, in bold type: Information for purchasers: If you receive financial statements from an issuer conducting a start-up crowdfunding distribution, you should know that those financial statements have not been provided to or reviewed by a securities regulatory authority or regulator. They are not part of this offering document. You should ask the issuer which accounting standards were used to prepare the financial statements and whether the financial statements have been audited. You should also consider seeking advice of an accountant or an independent financial adviser about the information in the financial statements.” 11
12 Item 7: USE OF FUNDS 7.1 Provide information on all funds previously raised and how they were used by the issuer. 7.2 Using the following table, provide a detailed breakdown of how the issuer will use the funds from this start-up crowdfunding distribution. If any of the funds will be paid directly or indirectly to a promoter, director, officer or control person of the issuer, disclose in a note to the table the name of the person, the relationship to the issuer and the amount. If more than 10% of the available funds will be used by the issuer to pay debt and the issuer incurred the debt within the two preceding financial years, describe why the debt was incurred. Description of intended use of funds Total amount ($) listed in order or priority Assuming minimum Assuming maximum offering amount offering amount Item 8: PREVIOUS START-UP CROWDFUNDING DISTRIBUTIONS 8.1 For each start-up crowdfunding distribution in which the issuer and each promoter, director, officer and control person of the issuer have been involved in any of the participating jurisdictions in the past five years, provide the information below: (a) the full legal name of the issuer that made the distribution, (b) the name of the funding portal, and (c) whether the distribution successfully closed, was withdrawn by the issuer or did not close because the minimum offering amount was not reached and the date on which any of these occurred. Item 9: COMPENSATION PAID TO FUNDING PORTAL 9.1 Describe the commission, fee and any other amounts expected to be paid by the issuer to the funding portal for this start-up crowdfunding distribution. Item 10: RISK FACTORS 10.1 Describe in order of importance, starting with the most important, the main risks of investing in the issuers business for the purchasers. 12
13 Item 11: REPORTING OBLIGATIONS 11.1 Describe the nature and frequency of any disclosure of information the issuer intends to provide to purchasers after the closing of the distribution and explain how purchasers can access this information. Item 12: RESALE RESTRICTIONS 12.1 Include the following statement, in bold type: The securities you are purchasing are subject to a resale restriction. You may never be able to resell the securities.” Item 13: PURCHASERS RIGHTS 13.1 Include the following statement, in bold type: If you purchase these securities, your rights may be limited and you will not have the same rights that are attached to a prospectus under applicable securities legislation. For information about your rights you should consult a lawyer. You can cancel your agreement to purchase these securities. To do so, you must send a notice to the funding portal within 48 hours of your subscription. If there is an amendment to this offering document, you can cancel your agreement to purchase these securities by sending a notice to the funding portal within 48 hours of receiving notice of the amendment. The offering of securities described in this offering document is made pursuant to a start-up crowdfunding registration and prospectus exemptions order issued by the securities regulatory authority or regulator in each participating jurisdiction exempting the issuer from the prospectus requirement. [If the funding portal is not operated by a registered dealer in any of the participating jurisdictions where you intend to raise funds, add the phrase and the funding portal from the registration requirement after the words prospectus requirement in the above paragraph].” Item 14: DATE AND CERTIFICATE 14.1 Include the following statement, in bold type: On behalf of the issuer, I certify that the statements made in this offering document are true.” 14.2 Provide the signature, date of the signature, name and position of the authorized individual certifying this offering document. 13
14 14.3 If this offering document is signed electronically, include the following statement, in bold type: I acknowledge that I am signing this offering document electronically and agree that this is the legal equivalent of my handwritten signature. I will not at any time in the future claim that my electronic signature is not legally binding.” 14
15 Securities regulatory authority and regulators of the participating jurisdictions: British Columbia British Columbia Securities CommissionThe document must be filed electronically at the same time as the report of exempt distribution in Form 45-106F6 at www.bcsc.bc.ca (click on BCSC eServices and follow the steps). Manitoba The Manitoba Securities Commission 500 400 St Mary Avenue Winnipeg, Manitoba R3C 4K5 Telephone: 204-945-2548 Toll free in Manitoba: 1-800-655-2548 Fax: 204-945-0330 E-mail: Exemptions.msc@gov.mb.ca www.msc.gov.mb.ca New Brunswick Financial and Consumer Services Commission 85 Charlotte Street, Suite 300 Saint John, New Brunswick E2L 2J2 Toll free: 1-866-933-2222 Fax: 506-658-3059 E-mail: info@fcnb.ca www.fcnb.ca Nova Scotia Nova Scotia Securities Commission Suite 400, 5251 Duke Street Halifax, Nova Scotia B3J 1P3 Telephone: 902-424-7768 Toll free in Nova Scotia: 1-855-424-2499 Fax: 902-424-4625 E-mail: nssc.crowdfunding@novascotia.ca www.nssc.gov.ns.ca 15
16 Québec Autorité des marchés financiers Direction du financement des sociétés 800, rue du Square-Victoria, 22nd floor P.O. Box 246, Tour de la Bourse Montréal, Québec H4Z 1G3 Telephone: 514-395-0337 Toll free in Québec: 1-877-525-0337 Fax: 514-873-3090 E-mail: financement-participatif@lautorite.qc.ca www.lautorite.qc.ca Saskatchewan Financial and Consumer Affairs Authority of Saskatchewan Securities Division Suite 601 - 1919 Saskatchewan Drive Regina, Saskatchewan S4P 4H2 Telephone: 306-787-5645 Fax: 306-787-5842 E-mail: exemptions@gov.sk.ca www.fcaa.gov.sk.ca 16
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